In 2024, analysts reported that approximately 116,000 vehicles were exported from China to the US, with a significant focus on US-branded models. Despite recent tariff measures imposed by US President Donald Trump causing panic in the financial markets, experts believe that Chinese automakers will only experience limited impacts.
According to a research note by analysts at Huatai Securities, the additional tariffs are unlikely to have a significant effect on Chinese car companies due to the majority of vehicles exported to the US being from US brands like General Motors and Ford. Chinese car companies are more focused on the Latin American market, with 445,000 vehicles exported to Mexico in 2024, representing a 7 percent increase from the previous year.
Anhui Jianghuai Automobile Group (JAC) is currently the sole Chinese automaker with localized production in Mexico, and the majority of Chinese vehicle exports to Mexico do not meet the USMCA tariff exemption regulations. This limits the feasibility of Chinese vehicles entering the US through Mexico.
While some Chinese automakers may consider establishing factories in Mexico to produce models that meet tariff exemption criteria for US exports, their primary focus remains on expanding in Latin America. Cui Dongshu, secretary-general of the China Passenger Car Association (CPCA), also emphasized the minimal impact of US tariffs on Chinese auto exports, noting that exports to the US accounted for just 1.81 percent of total exports in 2024.
The recent US decision to impose an additional 25 percent tariff on imported cars and parts has been met with opposition from the China Association of Automobile Manufacturers (CAAM). The CAAM criticized the move for violating WTO rules, disrupting trade order, and impacting global automotive industry stability.
As the situation unfolds, CAAM called for constructive consultations to find a mutually beneficial solution that maintains the prosperity and stability of the global auto industry. Despite the challenges posed by US tariffs, Chinese automakers remain resilient and focused on exploring opportunities in the Latin American market while navigating the evolving dynamics of international trade regulations.
