President Joe Biden will double, triple and quadruple tariffs on some Chinese goods this week and unveil the measures at a White House event intended as a defense of American employees, people conversant in the matter say.
Biden will raise or increase tariffs in key sectors after nearly two years of review. The overall tariff on Chinese electric vehicles will rise to 102.5% from 27.5%, the people said ahead of the announcement on condition of anonymity. Others will double or triple in certain industries, although the extent stays unclear.
One of the respondents said Biden and his staff have spent the previous couple of weeks finalizing the measures, including which points to make and which to avoid, saying the inputs are needed to spice up American growth. The final decision was a consensus, the person said.
It was not clear which items can be spared, but Biden wouldn’t announce any tariff cuts, two of the people said. The government has signaled to the U.S. solar industry that it should exclude some items, including machinery used to make solar panel components. The shift was sought by some device makers who say the present levies undermine Biden’s goal Ripping China’s clean energy supply chains away.
The 2024 presidential race is on the forefront of the flagship announcement: Biden is attempting to get tough on China and distance himself from Donald Trump – whose original tariffs Biden will largely renew, but who’s looking for sweeping increases that the present view Government will even be lifted widely.
The Biden administration has “focused on sectors that have long been a concern,” said Greta Peisch, a partner at law firm Wiley Rein LLP who served as top trade counsel for the Office of the U.S. Trade Representative until January.
“These are designed to address specific activities and risks and avoid escalation in order to maintain the relationship we have with China,” she said of those key items.
The White House declined to comment on the tariffs. The quadrupling of auto tariffs was first reported within the Wall Street Journal.
Biden will goal key sectors akin to electric vehicles, batteries, solar cells, steel and aluminum, it said. He has previously announced tariffs on steel and aluminum will rise to 25% for some products that now face a 7.5% tariff or no tariffs. The EV rate is meant to guard the U.S. from a possible flood of Chinese cars that might upend the politically sensitive auto sector.
Trump’s 200%
The announcement is the culmination of a review of tariffs first introduced by Trump, who mocked the announcement during a campaign rally in New Jersey on Saturday.
“He says he will impose a 100 percent tariff on all Chinese electric vehicles. “Isn’t that nice?” said Trump. “Biden should have done this four years ago.”
He warned that Chinese firms would try to construct cars in Mexico after which avoid tariffs by shipping them to the United States under the U.S.-Mexico-Canada deal that Trump agreed to as president. Trump said he would impose a 200% tariff on Chinese-made cars in Mexico.
“I’m going to put a 200% tax on every car that comes out of these factories and they won’t do that,” he said. Trump has also promised a blanket 60% tariff on all Chinese goods – a move that Biden is distant from as allies say it could stoke inflation.
Biden’s measures are less about breaking up market segments and more about averting an expected surge in imports: Chinese steel, aluminum and cars currently make up only a tiny fraction of US supply. The government has warned that China is pushing to corner the market in key sectors and flood the U.S. with subsidized goods to destabilize its rival and fuel its own recovery.
Still, the tussle signals a bipartisan consensus — led by the 2 presumptive presidential candidates — in regards to the threat that Chinese electric vehicles pose to the United States.
But that did not dampen enthusiasm for the U.S. debut of Zeekr Intelligent Technology Holding Ltd., Zhejiang Geely Holding Group Co.’s high-end electric automobile brand. The stock rose 35% on Friday after an expanded initial public offering, marking the most important U.S. listing of a China-based company since 2021. One of its executives downplayed the planned tariffs.
“We are not thinking about short-term headwinds. “We are thinking long-term and trying to make sure we deliver a very, very good business case over the long term,” said Chief Financial Officer Jing Yuan said Bloomberg Television on Friday. “It’s more about the long term than short-term headwinds.”
The administration’s approach is consistent with its goal of targeting China while maintaining relations, Peisch said.
“It’s about strategic action, not blanket escalation, but about what makes sense in response to China and in support of affected U.S. sectors,” she said.
