Shares in General Motors went up to 2.8 percent, while Tesla was up 0.7 percent
In another spectacular win for President Donald Trump, China has agreed to reduce tariffs on US cars from 40 percent to 15 percent, according to reports.
Following the agreement, US car firms jumped up in reaction to the news.
Shares in General Motors went up to 2.8 percent, while Tesla was up 0.7 percent and Ford 0.65 percent.
China is moving toward cutting its trade-war tariffs on imported U.S.-made cars, a step already claimed by President Donald Trump as a concession won during trade talks in Argentina.
A proposal to reduce tariffs on cars made in the U.S. to 15 percent from the current 40 percent — bringing the U.S. back in line with what other countries pay — has been submitted to China’s Cabinet to be reviewed in the coming days, according to people familiar with the matter. Shares of carmakers including Daimler AG, Ford Motor Co., and Tesla Inc. rose on the news.
The step hasn’t been finalized and could still change. While reversing the retaliatory duty is a significant climb-down by Beijing, it could re-focus the two sides toward implementing the trade-war truce agreed earlier this month.
The arrest of Huawei Technologies Co has since shaken relations. Chief Financial Officer Meng Wanzhou in connection with sanctions violations.
Very productive conversations going on with China! Watch for some important announcements!
— Donald J. Trump (@realDonaldTrump) December 11, 2018
In addition to a big conference call between key trade negotiators from the United States and China word that China will move on that Trump tweet to lower tariffs on US cars. https://t.co/2zNysySUlZ
— Charles V Payne (@cvpayne) December 11, 2018
“Last week, events seemed to conspire to throw the truce into disarray, but the underlying incentives of both sides at the moment are to try to maintain that truce,” Freya Beamish, chief Asia economist at Pantheon Macroeconomics Ltd.
“Now we see the possibility that China will come through with reductions of tariffs on U.S. autos and that’s another good, concrete step.”
In October, Neon Nettle reported that Trump doubled down on his ongoing trade war with China following a significant win in the country’s international trade battles.
Negotiators accepted late on Sept. 30 to sign a new trade accord, the U.S.–Mexico–Canada Agreement (USMCA) replacing the North American Free Trade Agreement (NAFTA)
US President Donald Trump tweeted:
Very productive conversations are going on with China! Watch for some important announcements!