US suggests additional tariffs if production of Chinese electric vehicles moves to Mexico

The Biden administration is suggesting that additional tariffs could be put in place if the Chinese makers of electric vehicles try to move their production to Mexico to avoid newly announced import taxes

The Biden administration is suggesting that additional tariffs could be put in place if the Chinese makers of electric vehicles try to move their production to Mexico to avoid newly announced import taxes.

President Joe Biden on Tuesday directed the office of the U.S. Trade Representative to impose a total tariff in excess of 102% on Chinese EVs, as well as directing new tariffs on other products including steel, aluminum, computer chips and solar cells.

But Chinese EV company BYD has previously indicated that it was looking at factory sites in Mexico for the Mexican market, creating a possible loophole to avoid the expanded tariffs.

Asked at the White House news briefing about new tariffs should Chinese companies launch production in Mexico, U.S. Trade Representative Katherine Tai said, “Stay tuned.”

Tai said that additional tariffs would require a “separate pathway” from the Section 301 review of the Trade Act of 1974. That four-year review led to the tariffs on $18 billion worth of Chinese imports announced on Tuesday.

Tai said that tariffs with Mexico was “something we are talking to our industry, our workers and our partners about.”