Can GM arrange a tariff exemption here?
The United States is currently encroaching on a possible trade war with other countries after announcing tariffs on imported vehicles and parts. One of the main targets of these tariffs is China, which poses a threat to several automakers that build cars there, including General Motors. GM is an American company that builds the Buick Envision and Cadillac CT6 plug-in in China, meaning those who cars would be hit with a 25% tariff. Automotive News reports that GM has asked the Trump administration for a tariff exemption on the Chinese-built Envision crossover.
GM claims that the tariffs would harm the company's ability to compete in the US luxury market. Buick sold 210,00 Envisions in China last year, but only 42,000 in the US. Those sales figures aren't enough to justify building the car in the US, but Buick needs the Envision in order to offer a full vehicle lineup against its luxury rivals. Other automakers and countries have urged President Trump to drop these tariffs to no avail. GM's formal request may be a last-ditch effort to persuade the president to call off the trade war.
In GM's request to the White House, the company said “While the volume of Envisions sold in the U.S. is small, it is strategically important and essential to the Buick brand. A 25 percent tariff on the Envision may eliminate the vehicles from Buick’s US offerings.” We recently reviewed the 2019 Buick Envision and found it to be a supple luxury SUV that offers excellent value for money. Hopefully, GM is successful in gaining a tariff exemption so it can continue to sell the underappreciated Envision.