In classic Donald Trump style, the executive chief used Twitter to make an important yet seemingly half-baked announcement late Sunday night. He stated “China has agreed to reduce and remove tariffs on cars coming into China from the U.S.”
Back in July, Chinese officials increased tariffs by 25 percent for cars imported into the largest automotive market in the world. American automakers felt a serious pinch, which in turn has affected vehicle production domestically. To get around these tariffs, foreign automakers are forced to enter complex agreements with Chinese automakers to produce vehicles within the country’s borders.
While a reduction in tariffs would help, it comes at a time when the Chinese vehicle market is cooling. Also, the timing of the supposed tariff slash isn’t known, and no other government officials on either side of the Pacific has said anything about it. Still, automakers saw their stock prices shoot up as investors became more optimistic about their future.
Are the tariff reductions even reality? As a report from The New York Times points out, Chinese officials often don’t share information with the public as a way to boost their own power in the country. But, some of Trump’s tweets have been overly simplistic on complex issues, similar to how Tesla CEO Elon Musk tweeted not too long ago about taking Tesla private.
Source: The New York Times