CRI听力:US Built Cars

Auto dealers in Shanghai say that the high-end US built cars which they are currently selling have been reserved and will not be affected by the newly issued anti-dumping and anti-subsidy policies. As a result, the subsidies have prompted a large number of customers to visit their local dealerships and place immediate orders.

Although BMW and Mercedes-Benz American units will be affected by the legislation, it is the local American brands that will sustain the heaviest damage.

According to experience in previous years, there may be some room for customers to negotiate on price, but it is now harder than ever to buy an American made car. A Cadillac dealer has this to say.

"Our cars sell very well. Some people who planned to buy one in January or February have made orders straight away because they are afraid of price hikes."
A Chrysler dealer explains.

"All the jeeps we sell have 2.5 liter engines or larger, and at the moment they sell very well. Some customers intended to wait until the prices decreased a little bit after the Spring Festival, but the price will definitely not drop 60 thousand yuan. So those customers have decided to buy one before the price surge."

The 60 thousand yuan that the dealer mentioned refers to the lowest price increase for imported Chrysler cars. The policy change directly affects the cost of US built cars. According to the new policy, the tariff rate for Chrysler cars is 15%, about 22% for GM, and as high as 34% for Ford. The General Manager of Shanghai Sen Hong Auto Sales Company, Shao Xiaodong says the prices of these vehicles will rise by dozens of thousands of yuan.

"Let's look at a 500 thousand yuan GM car. Based on the policy change, the price of this car will increase to 600 thousand."

Dealers of US built cars are not happy with the new legislation. They worry that the market share of American cars will shrink due to the price hikes. In the first three months of last year, 15 thousand US built cars were imported into China, making up only about 5% of the total market share. Meanwhile German built and Japanese built vehicles constituted 70% of the market share.

Chairman of the Auto Industry Association of the Chinese Trade Promotion Committee, Wang Xia says the policy change will significantly affect the strategy of large auto companies in the Chinese market.

"The anti-dumping and anti-subsidy policies will not affect the domestic imported vehicle market too much. I believe the legislation provides warning for German built and Japanese built cars. In the future, auto companies will adjust their strategies in the Chinese market when considering the policy issue."

At present, the majority of automobile companies think highly of the Chinese market, and most foreign companies have achieved local production. Experts say the policy change will accelerate the process of local production, and encourage more domestic auto companies to make money abroad.

For CRI, I'm Wang Jing.