WASHINGTON — A U.S. manufacturing commerce group on Friday urged the Biden administration to take steps to dam the import of low-cost Chinese language automaker imports from Mexico that it says might threaten the viability of American automotive corporations.
“The introduction of cheap Chinese autos — which are so inexpensive because they are backed with the power and funding of the Chinese government — to the American market could end up being an extinction-level event for the U.S. auto sector,” the Alliance for American Manufacturing mentioned in a report.
The group argues america ought to work to forestall cars and elements manufactured in Mexico by corporations headquartered in China from benefiting from a North American free commerce settlement. “The commercial backdoor left open to Chinese auto imports should be shut before it causes mass plant closures and job losses in the United States,” the report mentioned.
Car and elements produced in Mexico can qualify for preferential remedy underneath the U.S.-Mexico-Canada commerce settlement in addition to qualifying for a $7,500 electrical automobile tax credit score, the report famous.
The Chinese language Embassy in Washington and the U.S. Commerce Consultant workplace didn’t instantly remark.
The difficulty has taken on new curiosity after information retailers reported that China’s BYD plans to arrange an electrical automobile manufacturing unit in Mexico. BYD, identified for its cheaper fashions and a extra different lineup, not too long ago overtook Tesla to grow to be the world’s prime EV maker by way of gross sales.
Tesla itself introduced plans nearly a 12 months in the past to construct a manufacturing unit in Mexico, within the northern state of Nuevo Leon. In October, Mexico mentioned a Chinese language provider for Tesla and a Chinese language expertise firm would make investments almost a billion {dollars} within the state of Nuevo Leon.
A bipartisan group of U.S. lawmakers has urged the Biden administration to hike tariffs on Chinese language-made autos and examine methods to forestall Chinese language corporations from exporting to america from Mexico.
A bunch of lawmakers urged U.S. Commerce Consultant Katherine Tai to spice up the present 27.5% tariff on Chinese language autos and mentioned USTR “must also be prepared to address the coming wave of (Chinese) vehicles that will be exported from our other trading partners, such as Mexico, as (Chinese) automakers look to strategically establish operations outside of (China).”
Alliance for Automotive Innovation CEO John Bozzella has mentioned that proposed U.S. environmental rules might let China achieve “a stronger foothold in America’s electric vehicle battery supply chain and eventually our automotive market.”
The U.S. Treasury issued pointers in December on the $7,500 EV tax credit score aimed toward weaning the U.S. electrical automobile provide chain away from China.