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UK automakers buoyed by China tariff cuts

By Angus McNeice | chinadaily.com.cn | Updated: 2018-04-17 22:42
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An employee works on an Aston Martin vehicle at the company's factory in Gaydon in the United Kingdom. [Photo/Agencies]

New market could be vital after Brexit

British automakers said that proposed cuts to Chinese import tariffs could provide a welcoming boost to the country’s car industry as it contends with declining exports to the European Union.

During his keynote speech at the Boao Forum for Asia 2018 this month, President Xi Jinping said that China will "significantly lower" tariffs on car imports this year and will also ease restrictions on foreign ownership in the car industry.

Last year, British car exporters were propped up by increased demand from China, Japan and the United States as exports to the EU fell by 5 percent, and overall exports dipped by 1.1 percent.

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, welcomed Xi’s announcement, calling China a “crucial bilateral trading partner” for the UK car industry. British automobile exports to China increased 19.7 percent last year.

“It's encouraging to hear that China is considering reducing import tariffs on cars as this will certainly encourage demand for Britain's ever-growing range of premium, luxury and sports vehicles,” Hawes said.

Hawes had previously said industry players “urgently need clarity” from the UK government as Britain negotiates its exit from the EU. The UK car industry relies heavily on exports - almost eight in 10 cars made in the UK are sent abroad - and the EU accounts for just more than half of British car exports.

As demand from the EU has fallen, major British automakers have ramped up efforts to expand in China.

In January, British luxury sports car manufacturer Aston Martin announced it would invest 620 million pounds ($887.9 million) in China, including 10 new dealerships bringing its total to 20 by the end of 2018.

UK sports car maker McLaren Automotive is set to expand its presence in China this year by adding 10 new retailers, according to Dan McElholm, the company’s managing director for China.

He also said McLaren will soon begin exporting its 570S Spider convertible and the 720S supercar to China.

“The news that China is considering reducing import tariffs is extremely encouraging,” McElholm said. “We see China as an increasingly important market for McLaren where we are set to double sales this year, expand our retailer network and boost local investment, all while working closely with local businesses, affiliate companies and craftspeople to jointly celebrate British and Chinese culture and talent.”

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