Politico | Donald Trump’s trade war tariffs on car industry sending shock waves through global supply chain
- US tariffs on vehicles and parts would reverberate through global car supply chain, with both US and Chinese manufacturers standing to lose out
- China sells few cars to the United States but is the second biggest exporter of parts to the US, after Mexico
This story is part of an ongoing series on US-China relations produced jointly by the South China Morning Post and POLITICO, with reporting from Asia and the United States.
Jack Sun’s company does not sell directly to the United States but if US President Donald Trump decides to slap tariffs on the global car industry, suppliers such as Sun’s machinery firm would be right in the line of fire.
Qingdao Ray Machinery and Technology, a 30-person operation based in northeast China, exports moulds and tools for a Chinese invested tyre company in the Middle East, which in turn supplies the US and Europe.
Although Trump may think he is aiming his tariffs at big European luxury brands and Asian giants like Toyota and Honda, the additional duties could send shock waves throughout a global supply chain, hitting small cogs like Qingdao Ray.
“The US is one of the largest auto markets in the world. If it puts tariffs on the rest of the world, the impact will be significant,” Sun said. “It will affect my client first and then definitely me. It is difficult to find an export market as big as the US.”
“If the US started putting tariffs on the imports of cars and car parts, that could cause a reduction of orders from my client, which mainly exports tyres to the US and Europe.”
