The Chinese tariff had been 25 percent and, earlier this year, the country was set to roll the tax back to just 15 percent. But when Trump announced broad new U.S. tariffs on Chinese made goods, the Beijing government raised duties specifically on American-made automobiles and parts.
The impact is actually less than that being felt in some other sectors of the U.S. economy, such as agriculture, but it is still a hit to the auto industry, which shipped about 250,000 vehicles to China last year. Vehicle sales were expected to grow because demand for SUVs had risen there.
BMW, the largest exporter of American-made vehicles, has been planning to boost output of utility vehicles from its Spartanburg, South Carolina, plant with the launch of its new flagship, X7 SUV — many of them bound for China.
Volvo, meanwhile, had earmarked about half of the vehicles it will produce at its new Charleston, South Carolina, plant for export, many of those also bound for Chinese consumers.