1. Home
  2. >
  3. Car News
  4. >
  5. Hot News
  6. >
  7. Comment: How much does...

[YesAuto 快评] On April 4, 2018, a blockbuster piece of news was sent to the automotive industry: According to the relevant provisions of the “Foreign Trade Law of the People's Republic of China” and “Import and Export Tariff Regulations of the People's Republic of China”, approved by the State Council, the State Council The Tariff Commission decided to impose 25% tariffs on 106 items of 14 categories, including automobiles and chemicals originating in the United States. The implementation date will depend on the implementation of additional tariffs imposed by the US government on our products, and will be announced separately by the Tariff Commission of the State Council. Although this policy has not yet been formally implemented, if it is implemented, many domestic imported passenger cars from the United States will be affected, regardless of whether it is 4S dealer channels or parallel imports. Even in the near future, these models will be second-hand. Car prices will also be increased by this factor. Today, let us do a detailed inventory to see which models around us will be affected by this policy.

● Event review

On March 22, local time in the United States, US President Trump signed a Presidential Memorandum, according to the results of the “301 Investigation”, to impose large-scale tariffs on Chinese imports and restrict Chinese companies' investment and mergers in the United States. Trump claimed that the scale of Chinese goods involved in taxation could reach 60 billion U.S. dollars. Regarding the measures of the Trump administration, the Ministry of Finance of my country announced on April 4 that with the approval of the State Council, the Tariff Commission of the State Council decided to impose an additional 25% on 106 items of 14 categories such as soybeans, automobiles, and chemicals originating in the United States. Tariffs. A trade war between China and the U.S. may start here.

It is not difficult to see from the list that the range of vehicle models involved in this tariff adjustment is very wide, ranging from traditional power models with a displacement of more than 1.5L to new energy vehicles, and even auto parts are included. .

Which models will be affected by this?

After reading the long list, let’s take a look at which models may be affected by this tariff adjustment. (All models include but are not limited to the following list) The models that are mainly affected this time are those with the origin in the United States. This mainly includes two major categories : one is American brands and models produced in the United States. This kind of understanding is better. For example, almost all of the two major brands of Lincoln and Tesla currently sold in China are in this list; the other is a non-American brand but also produced in the United States, such as Mercedes-Benz. The two popular SUVs, GLE and GLS, are also implicated because their production plants are located in the United States.

First of all, you will find that not all American cars are affected. For example, the Lincoln brand lacks the MKZ and MKX models. The main reason is that their production plants are located in Mexico and Canada, which are not within the scope of the policy. The 300C models and Grand Jielong models in the Chrysler brand are also produced in Canada, so they will not be affected either (not limited to the 4 models we listed above). On the other hand, many models that are not American brands but are manufactured in the United States and eventually imported into the country are also affected. In addition to the two hot-selling SUVs mentioned above by Mercedes-Benz, BMW is in China. The hot-selling X series models are also among them. For example, the familiar and well-selling X3 and X5 may all be affected by it, but fortunately, the BMW X3 will soon be made in China, so the future impact on domestic consumption is almost negligible. At the same time, many Japanese brands produced in the United States will be affected, including Acura and Infiniti, as well as Toyota's parallel imported cars that everyone may be familiar with, such as Senna and Sequoia.

■ How to calculate taxes and fees? How much?

Take a 2.0T (assuming engine displacement of 1997ml) with a customs declaration price of RMB 300,000 as an example, the tax rate before the additional tariff is 25%, the tariff should be 30*0.25=75,000, and the consumption tax is (30+7.5) /(1-0.05)*0.05≈19736 million, and the value-added tax is (30+7.5+1.9736)*0.17=67,100, and the total cost before the additional tariff is about 461,84 million. After the 25% tariff is imposed, its cost has risen to about 554,21 thousand yuan, which is almost 100,000 yuan, and the increase is still very obvious.

■ If the price increase is true, how big is the impact of sales?

If the trade war really starts, which brands will be most affected? Here we also select a few brands and make an analysis with everyone. First of all, we can expect that the brand most affected by the policy is Tesla, because it is currently only produced in the United States, and the increase in tariffs will inevitably affect its costs. According to previous news , Tesla’s sales in the Chinese market exceeded US$2 billion in 2017, and a total of about 20,000 vehicles were sold. The Chinese market’s sales in 2017 accounted for 20% of the world’s total . If the policy is officially implemented, how much will the price of domestic vehicles change? Let’s take MODEL 3, which is about to enter the country, as an example. Its starting price on the official website of China is about 35,000 US dollars, which is equivalent to 217,000 yuan (the exchange rate is calculated at 6.2). Let’s not consider the shipping cost and just look at the tax rate adjustment. Look at the final price changes. Through calculation, it can be concluded that if the tax rate is 25%, the cost of MODEL 3 is 317,400 yuan, but if the tax rate is increased to 50%, its cost will rise to 380,800 yuan, an increase of close to 20%. And this data is still in the case of the lowest equipped car model and no freight calculation. If the freight is included, the increase will be even higher.

After talking about Tesla, let's talk about Lincoln. In 2017, Lincoln sold 54,124 units in the Chinese market, which was better than Tesla, with a year-on-year increase of 66%. The Chinese market has also become Lincoln’s second largest market in the world. 100,000 units . Tariff increases are also not good news for Lincoln, which is not yet made in China. Let’s take the current domestically very hot new car pilot as an example. The calculation is also based on the lowest price in North America. The lowest price given by North America’s official website is equivalent to RMB 467,700, which is 871,100 yuan after calculating the cost according to the 25% tax rate. After the upgrade, the cost will be 1.045 million, and the minimum increase is also close to 20%. (The domestic price range of the Lincoln Navigator is: 98.88-1.228 million).

■ How to deal with price increases in the future?

After reading our list of models and simple calculations, many consumers may feel that the future price increase of these models we mentioned is inevitable. Should we hurry up now? Don't worry, first of all, this policy has not been officially implemented, so the current domestic spot models will not be affected. So if one day after the implementation is officially announced, will dealers and parallel import car dealers have a way to avoid price increases? Let's analyze the situation separately from 4S channels and parallel import channels.

● 4S shop channels

Let’s talk about the 4S channel first. We visited dealers whose products such as Lincoln and BMW will be affected by this. However, since the policy has not yet been implemented, they cannot comment on the policy at the level of 4S stores. Whether the price of the model will eventually be adjusted. They also need to wait for the information given by the factory after the policy is implemented. From what we currently know, the situation of Lincoln and Tesla is the least optimistic. The sales of these two brands in China are both in the forefront of the world. If tariff increases are officially implemented, it will be difficult to avoid the overall increase in car prices, and its competitiveness will inevitably be affected to a certain extent. And we also speculated several possible countermeasures based on the current situation: 1. Localization as soon as possible. Tesla has previously reported that it will be put into production in China. Although it has not yet been confirmed, the increase in tariffs may become a driving force. Another important factor for localization. In addition to Lincoln MKX and MKZ, which avoided tariff increases due to the origin, the import costs of other models will rise, and domestic production may not be a good way out. 2. Imported from other countries that produce this model, such as BMW X series models. In addition to the U.S.-produced models, there are also Thai-manufactured models available for sale. If the tariff is increased, you only need to import from Thailand. The degree of reduced impact. 3. Follow the price increase and let consumers pay. This should be the most unwilling situation for domestic consumers, including distributors. 4. The manufacturers themselves bear this cost until the end of the trade war. 5. In order to maintain the original terminal prices, manufacturers have simplified the allocation of vehicles to compensate for the increase in costs caused by tariffs. In these situations, no matter which method is used, it can only be regarded as a compromise. For consumers and manufacturers, it is not a win-win situation.

● For parallel imported cars

In order to have a more comprehensive understanding of the impact of the tariff increase on the domestic auto market, we interviewed parallel import car dealers in Shanghai for some imported models of non-US brands. We know from their mouths that currently in the entire parallel imported car market, the proportion of models imported from the United States is not large, so the overall impact will not be too obvious. The cars imported from the United States are mainly concentrated in several mainstream brands that we are familiar with. Take Mercedes-Benz as an example. The two models of GLE and GLS are imported from the United States in a large proportion, but the current inventory is sufficient, so the price will not fluctuate in the short term. Even if the price rises, these two models still have certain advantages in the market. Substitution, so in the long run, their sales will not decline too significantly. The impact of tariff hikes on parallel imports of BMW is even smaller. Among them, X5/X6 have a strong replaceability, and they can be imported from Thailand to avoid price increases. The sales of BMW X4 are very small, and it is also for dealers. Don't care too much. As for some higher-end and higher-priced models, its final price is difficult to affect consumer purchases, so I will not analyze it in detail here.

Will the used car market have an impact?

If the price of new cars finally rises, will the price of second-hand cars also rise? We also invited people from the second-hand car industry in Shanghai to analyze the situation. First of all, they feel that if the trade war is officially launched, it will eventually have an impact on the market for imported second-hand cars in the United States, but this is also the premise that the establishment of a Sino-US trade war will enter a long-term confrontation. Because it may take 2-3 months to determine the price increase of a new car and implement it to the sales end, and then the purchase price of used cars will start to gradually increase, and it may take 1-2 months to finally reflect the sale price of used cars. The process from the price increase of new cars to the price increase of second-hand cars can last up to five months, and whether the Sino-US trade war can last for that long remains a question. So at present, everyone is mainly on the sidelines.

● Full text summary

If the Sino-US trade war continues, the “Foreign Trade Law of the People's Republic of China” and the “Import and Export Tariff Regulations of the People's Republic of China” will impose 25% tariffs on 14 categories of 106 products originating in the United States, including automobiles. Implementation, according to our above content, most of the vehicles owned by American auto companies will be affected, and there will also be some non-U.S. brands that have built factories in the United States. Regarding the tariff increase, Dong Yang, executive vice chairman of the China Automobile Association, said bluntly: “Sino-US auto cooperation is a mutually beneficial cooperation and is absolutely beneficial to the United States. If there is no development in the Chinese market, the three major U.S. GM, Ford and Chrysler cars The company will become a second-rate company!”

It can be said that the occurrence of this incident has caused great harm to American car brands, but the harm to consumers is not as great as we imagined. After all, the opportunities in the Chinese market are often “fleeting.” The increase in tariffs has led to a substantial increase in the final prices of some vehicles, and the most direct guide is the rapid decline in the product strength of the vehicles. At the same time, in a fast-paced consumer market like China, if the brand's product strength is weak, it will only allow other brands' products to quickly replace them, thus occupying the market. In addition, the main consumer force in the Chinese market is gradually becoming younger, followed by an increase in acceptance of new things and a decline in brand loyalty. Therefore, if the regulations are implemented in the near future, the damage to American brands must be continuous.

Insert a voting mark: “If the regulations are implemented, will it affect your car purchase decision? 》