GM’s Request for Chinese-Built Buick Envision Tariff Relief Denied by U.S.

June 7, 2019

https://www.fidelity.com/news/article/top-news/201906042147RTRSNEWSCOMBINED_KCN1T530U-OUSBS_1

This is rich.  GM actually had the nerve to ask the U.S. government for relief on the 25% tariff it now faces on the Chinese-built Buick Envision.  (See above-linked article.)  After repeatedly angering the Trump administration with plant closures in the U.S. and moving production to Mexico, did GM really expect its request to be granted?

GM, the largest U.S. automaker, argued in its request that Envision sales in China and the United States would generate funds “to invest in our U.S. manufacturing facilities and to develop the next generation of automotive technology in the United States.”

Someone at GM must have thought, “let’s anger the administration even more with a really stupid explanation.”

As mentioned in the article, the government also denied Volvo’s tariff relief request for the Chinese-built model XC60 SUV – its best seller in the U.S.

These are good examples of key points I made in my previous post.  First of all, as mentioned in the article, GM is “eating” the tariff and not passing along the extra cost to buyers.  Secondly, the article points out that the Envision, starting at about $35,000, is a mid-size SUV that competes with other such vehicles like the Jeep Grand Cherokee.  Not mentioned is that the Jeep Grand Cherokee starts at $32,000.  So much for the claim that imports provide American consumers with lower prices.

It’s nice to see that our trade policy isn’t being run by the kind of fools we’ve had in past administrations.  And it’s nice to see that sales of the Buick Envision are tanking.  Apparently, consumers who usually pay no attention to where something is made and just assume that a Buick is an American car are waking up to the fact that they come from China.  Will anyone feel sorry for laid-off Chinese auto workers when GM cuts a shift at the Chinese plant?