China's Finance Ministry has said that it will slash import tariffs on certain vehicles to 15 percent, down from 25 percent, and also said that tariffs on automotive parts including bumpers and seat belts would fall to 6 percent. The cuts will be effective from July 1.
© Image | mof.gov.cn
Import tariffs on certain vehicles to 15 percent, down from 25 percent
Automotive parts would fall to 6 percent.
The cuts will be effective from July 1.
The announcement was issued on Tuesday, adding that this was part of efforts to open up China’s markets and spur development of the local auto sector.
© Image | mop
Chinese car imports rose 16.8 percent year-on-year in 2017, according to state-run news agency Xinhua in February, citing the China Automobile Dealers Association. Around 1.2 million vehicles were brought into the country.
© Image | truthaboutcar
How Dose It Affect You?
In China, you can pay 8%-15% money less to to purchase imported cars. For example, a car’s custom value is 400,000 RMB, whose import tariffs is 400,000 × 25% = 100,000 RMB. After import tariffs cut, it would be 400,000 × 15% = 60,000 RMB only, with 40,000 RMB saved.
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The requirement of imported car will be increased obviously. It is expected about 1.5 million vehicles are brought in China in the near future. Now, the number is 1.2 million.
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The tariffs wouldn’t be cut more in the short term.
Automobile Brands
For many car makers, they already have established operations and production in the country. However, there's one notable automaker left out of the mix: Tesla Inc.
© Image | Tesla
Now Tesla will benefit most because China’s government provides incentives to new-energy vehicle buyers, and the electric-car maker relied entirely on imports for the more than $2 billion in sales it generated in the country last year.
© Image | thestreet
According to an internal document of the company, all car models may be set for a price cut in the range of 40,000 yuan (US$6,283) to 90,000 yuan (US$14,137), apart from the MXP100D model, which could be reduced by over 90,000 yuan.
© Image | SCMP
Except Tesla, other automobile brands also responsed the policy to adjust their product's price.
Porsche: After assessing the policy, Posche will announce the concrete adjustments.
BMW: BMW will adjust automobile price after assessing yet.
Toyota: Toyouta will lower its pirce of export vehicles to China.
Volkswagen: Volkswagen will also adopt the measures later.
Bentley: Bentley will adjust automobile's pirce based on the relevant policy.
Lexus, Benz and Ford said that the adjustive measures will be taken soon.
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Ref | cnbc, thestreet, china.org
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