The Chinese government is considering a proposal to reduce tariffs on U.S.-Built vehicles from the current 40 percent back down to the 15 percent before the trade war broke out between it and the U.S. Sources tell Bloomberg a proposal has been submitted to the cabinet to be reviewed in the coming days.
This proposal stems from a trade summit in Buenos Aires where U.S. President Donald Trump and Chinese President Xi Jinping agreed to a 90-day truce on the trade war earlier this month. After the meeting, Trump tweeted out that "China agreed to “reduce and remove” tariffs on imported American-made cars, something China did not confirm at the time." Shares of various automakers including Diamler, Ford, and Tesla rose on the news.
The trade war between the U.S. and China has taken a toll on automakers. Both BMW and Dimaler have warned of lower profits as tariffs have forced them to raise prices in China. Others such as Volvo and Ford have made changes to production and vehicle plans.
China's Finance Ministry didn't respond to Bloomberg's request for a comment.