The German luxury car maker will start selling the BMW X5 and X6 SUV models by 4 percent to 7 percent higher in China starting July 30. The increase in price shall cover the additional cost of tariffs incurred after China imposed duties on about $34 billion of U.S. imports.
The surge in pricing also reflected BMW's burden of shouldering the hefty costs of delivering the SUV's to China from its facility in South Carolina. The German car maker has not mentioned plans of implementing similar price surge on its BMW X4 model.
A BMW representative told Reuters the company is vouching for free trade. The representative, however, added that the German carmaker needed to adapt to the market changes.
Reuters also found out that Mercedes Benz in mid-July had already raised its pricing of a midsize SUV model in China. The said SUV is produced in Alabama.
On the other hand, U.S. carmaker Ford was not keen on implementing a price increase with any of its cars. The company said it would likely to sit on the market changes and instead work on sustaining its business momentum.
On July 6, China placed an additional 25 percent levy on cars made from the U.S. With this, China now imposed a tax of about 40 percent on all vehicles imported from the U.S.
In its defense, China said the levies imposed on U.S. imports were merely a retaliatory move after President Donald Trump implemented the same on Chinese goods. Local Chinese officials had in fact accused the U.S. of starting the "largest trade war in economic history" according to BBC.
On the other hand, President Trump asserted that tariffs imposed are meant to curb unjust transfers of American technology and intellectual property to China.
In the middle of the US-China trade war are SUV consumers with numbers booming since 2017. BMW, for one, shipped more than 100,000 of its cars from the U.S. to China in 2017 alone.
Meanwhile, big players in the car industry are planning to meet without the U.S. to discuss steps on how to respond with President Trump's looming worldwide tariffs on car imports. Officials of the European Union, Canada, Mexico, South Korea and Japan are reportedly planning to meet in Geneva on July 31, said anonymous sources who spoke with Bloomberg. Also included in their agenda are ways to reform the World Trade Organization.
Bloomberg reported that Jean-Claude Juncker, president of the European Commission, and President Trump had previously deceased from any unilateral decisions while the E.U. and the U.S. are still negotiating on more effective trade pacts. However, a department had reportedly been established to investigate on whether any implemented car import tariffs could pose a threat to national security.
