GAC’s U.S. Sales Plan Hits Political Headwinds

Guangzhou Automobile Group Co.’s hopes of selling cars in the U.S. by the end of 2019 have encountered political opposition in Washington, D.C., Reuters reports.

GAC announced earlier this week it aimed to launch U.S. sales. The Chinese carmaker suggests it might initially do so by offering cars through Fiat Chrysler Automobiles dealerships.

But both President Donald Trump and Senate minority leader Chuck Schumer (D-N.Y) object. They note that China imposes 25% tariffs on cars imported from the U.S., but Chinese-made cars encounter only 2.5% taxes when they are shipped to the U.S.

Schumer describes the difference as “manifestly unfair” and an example of China’s “rapacious” trade policies.

But neither Schumer nor Trump has commented on other Chinese-built vehicles already sold in the U.S. General Motors Co. began importing Buick Envision small crossover vehicles from China two years ago. Over the same period, Geely Automobile Holdings has been doing the same with Volvo cars it makes in China.

Ford Motor Co. said in June that most of the Focus small sedans it sells in the U.S. will be sourced from China by 2019. The company says doing so will be $1 billion cheaper than moving production of the car from Michigan to Mexico.​​​​