US-China trade stoush may dent key automakers

United States-China rising trade tensions may dent production by some automakers, including Tesla.

German luxury SUVs made in the US and sent to China, and Ford, could also be vulnerable.

A trade war would see vehicle production in both countries affected.

But US factories would face the strongest impact because China imports nearly 270,000 US vehicles, worth US$11 billion, and sends relatively few back, Reuters reports.

Tesla’s California plant ships an estimated 15,000 cars annually to China, so it and BMW’s South Carolina facility and Daimler AG’s Alabama factory, could lose hundreds of millions of dollars’ worth of production if China proceeds with a threat to double import tariffs. All three export high-margin luxury models to China.

Ford’s problem involves both imports of premium Lincoln vehicles to China and a plan to export low-cost Focus compacts from China to the United States. While Ford declined to comment specifically on plans for the Focus and Lincoln, it says: “We encourage both governments to work together to resolve issues between these two important economies.”

General Motors imports only 30,000 Buick Envision crossovers a year from China, while sending just a handful of vehicles back. GM says it’s too early to predict how the proposed US tariffs will impact on its Envision plans, Reuters says.

A Mercedes-Benz spokesman says it’s closely monitoring the situation.

BMW says further trade conflict escalation will be harmful for “all stakeholders”.

Tesla declines to comment.

The US has a 60-day comment period on plans, and China is waiting for US action before implementing its own.