MercoPress. South Atlantic News Agency

China imposes punitive duties on large cars exported from US

US manufactured SUV have a growing market among rich Chinese

China will impose punitive duties of up to 22% on large cars and SUVs exported from the United States, China's Commerce Ministry said on Wednesday, the latest in a series of trade disputes between the world's two largest economies.

The new duties take aim at vehicle exports valued near 4 billion dollars this year and models that include the Cadillac Escalade made by General Motors Co, the Jeep Grand Cherokee from Fiat SpA affiliate Chrysler Group LLC and SUVs from Daimler AG's Mercedes and BMW AG.

China's action comes at an awkward time for US-China relations, with China's currency and trade policies becoming a focus of criticism for US presidential candidates and as China's growing diplomatic and military influence raises concern in the region and beyond.

Chinese officials said the US-built SUVs and large cars were being dumped on the Chinese market and causing “substantial damage to China's domestic industry.” Vehicle exports to China had already been subject to a 25% tariff and the new tariff will be in addition to that duty.

The decision by Beijing to impose the additional levy comes after China lost a two-year fight over tire exports to the United States in September.

A World Trade Organization ruling favoured an Obama administration proposal to sharply increase duties on Chinese tires, rejecting an appeal that the 2009 move was protectionist and would hurt China's tire industry.

“We are very disappointed in this action by China,” US Trade Representative spokeswoman Carol Guthrie said.

The new duties on US-made large cars and SUVs range from a 2% levy on BMW models to 15% for Chrysler and almost 22% for GM. Ford Motor Co does not export US-built vehicles to China.