China’s trade threat could hurt German carmakers more than US auto giants

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Johannes Eisele | AFP | Getty Images

Tesla car dealership in Shanghai taken on March 17, 2015.

The U.S. firm Tesla doesn’t provide numbers of deliveries to China but does offer revenue data, suggesting sales worth around $2 billion in 2017. According to Evercore, Tesla could, therefore, be a big loser with tariff impacts potentially reaching $507 million in 2018.

Tesla has reportedly agreed with Chinese officials to build a plant in Shanghai but nothing concrete has yet been announced, with some suggesting that Beijing wants to impose a joint venture arrangement.

The U.S.-based firms Fiat Chrysler and Ford already have Chinese manufacturing plants in place and because of this they are seen as relatively immune to the latest salvo of trade threats. Evercore estimates that Ford would import just under 19,000 cars to China this year at an average transaction price of $32,000. The dollar impact from any fresh tariff would, therefore, total just $151 million.

For Fiat Chrysler Autos, the situation is even less dramatic. Evercore suggested that in 2018 the negative dollar impact would be around $80 million. According to Evercore, GM will export no cars to China from the United States in 2018.



Source : CNBC