President Joe Biden will double, triple and quadruple tariffs on some Chinese goods this week, people familiar with the matter said, unveiling the measures at a White House event aimed at protecting American workers.
After nearly two years of review, Biden will raise or increase tariffs in key areas. Before the news was announced, people familiar with the matter who asked not to be named said that China’s total tariffs on electric vehicles will rise from 27.5% to 102.5%. Other targeted industries would double or triple in size, but the scope remains unclear.
One of the people said Biden and his staff have spent a lot of time in recent weeks finalizing the measures, including which projects to attack and which to avoid because these investments are necessary to promote the growth of the U.S. economy. The person said the final decision was unanimous.
Two people familiar with the matter said it was unclear which goods would be spared, but Biden would not announce lower tariffs. The U.S. government has sent a signal to the U.S. solar industry that it will exclude certain projects, including machinery used to make solar panel components. Some equipment makers seeking such a shift say the current tax undermines Biden’s goal of wresting clean energy supply chains from China.
The 2024 presidential campaign looms large in this flagship statement: Biden is seeking to crack down on China and distinguish himself from Donald Trump – who will largely extend Trump’s initial tariffs but Trump is seeking to raise interest rates broadly, and the current administration sees this as continuing to raise rates.
Greta Peisch, a partner at law firm Wiley Rein LLP, said the Biden administration has been “focused on areas of long-term concern.”
“These measures are designed to address specific activities and risks and avoid escalation in order to preserve our relationship with China,” in addition to these critical commodities, she said.
The White House declined to comment on the tariffs. The quadrupling of auto tariffs was first reported by the Wall Street Journal.
People familiar with the matter said Biden would target key industries such as electric vehicles, batteries, solar cells, steel and aluminum. He had previously announced an increase in tariffs on steel and aluminum to 25%, compared with some products that currently have tariffs of 7.5% or no tariffs. The EV tax is intended to protect the U.S. from a potential influx of Chinese cars that could upend the politically sensitive auto industry.
Trump 200%
The announcement was the culmination of a review of tariffs first imposed by Trump, which he mocked at a campaign rally in New Jersey on Saturday.
“He said he would impose a 100% tariff on all Chinese electric vehicles. Isn’t that great?” Trump said. “Biden should have done this four years ago.” “
He warned that Chinese companies would try to build cars in Mexico and then ship them to the United States to avoid tariffs under the United States-Mexico-Canada Agreement, which Trump agreed to when he became president. Trump said he would impose a 200% tariff on Chinese-made cars in Mexico.
“I would put a 200 percent tax on every car that comes out of these factories, but they won’t do that,” he said. Trump also promised to impose sweeping 60% tariffs on all Chinese goods, but Biden has not done so, which allies say will increase inflation.
Biden’s measures are less about suppressing parts of the market than about stemming an expected growth in imports: Chinese steel, aluminum and cars currently account for only a small portion of U.S. supply. The U.S. government has warned that China is pushing to monopolize markets in key areas and provide the U.S. with heavily subsidized goods to destabilize rivals and fuel its own recovery.
Still, the jousting marks a bipartisan consensus — led by both presidential candidates — on the threat posed by Chinese electric vehicles to the United States.
This has not dampened enthusiasm for Zeekr Smart Technology Holdings Co., Ltd., a high-end electric vehicle brand owned by Zhejiang Geely Holding Group Co., Ltd., to list in the United States. The company’s stock price rose 35% on Friday after the company expanded its initial public offering, becoming the largest U.S. listing so far. company.
“We don’t think about short-term headwinds. We look at the long term and try to make sure that in the long term we can create a very, very good business case. “That’s more of a long-term view than short-term headwinds. “
Pesh said the administration’s approach was consistent with its goal of targeting China while maintaining relations.
“This is strategic, not a full escalation, but a response to China and support for affected U.S. industries,” she said.
