German automakers stand to benefit more from China's decision to reduce import duties on cars as they built the most cars that China imported in 2017, the Financial Times reported.
China's Ministry of Finance on May 22 slashed import duties on cars to 15% from 25% and cut tariffs on auto parts to 6% in a bid to further open up its market while the U.S. and China continue talks on a potential trade agreement.
About 33% of the cars China imported in 2017 were made in Germany, edging out the U.S., which accounted for 22% of imports, the FT said, citing data from Jato Dynamics. Japan and the U.K. accounted for 20% and 9%, respectively, of imports.
Even German brands Bayerische Motoren Werke AG and Mercedes-Benz export "large numbers" of luxury SUVs to China from U.S. plants. BMW and Mercedes are expected to ship 89,000 cars and 65,000 cars, respectively, via this arrangement, the FT reported, citing data from research group IHS.
BMW shares rose 2.6% and closed up 0.62% after the tariff reductions were announced, while shares of Daimler AG, which owns Mercedes-Benz, gained 1.5% during the day's trading and finished 0.34% higher.
China's move to lower tariffs on cars marks a turnaround from Beijing's threats in April to add 25% tax for U.S.-built vehicles on top of an existing 25% tax on all car imports.
