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Chinese Manufacturers May Soon Look To Enter U.S. Market

Nov 05, 2013

Industry press has recently reported that Chinese automakers are starting to ask some of the largest Western auto parts companies to supply parts that meet American and European regulatory standards. Industry observers say these inquiries are a clear sign that Chinese manufacturers are starting to feel more confident about finally exporting vehicles to the United States on a larger scale.According to press reports, Chinese officials may soon lower tariffs (currently 25%) on imported vehicles. By comparison, there is a 2.5% tariff on vehicles imported into the United States. Additionally, it is reported that China may soon “reduce” its current requirement that foreign automakers set up assembly plants in China as 50-50 joint ventures. The joint venture requirement has allowed Chinese managers and engineers to learn about Western technologies and management methods.Some industry observers predict that Chinese carmakers (likely newer or privately-owned manufacturers) may finally enter the United States market in the next five years. If these reports are true, there may be new franchise opportunities available for dealers in the United States.