WASHINGTON – Congressman Dale E. Kildee (D-MI) helped introduce a bill this week that would prevent imports of passenger cars from China unless the U.S. and Chinese tariffs on autos are equalized.  Kildee and Congressman Walter B. Jones (R-NC) introduced the Unfair Chinese Automotive Tariff Equalization Act this week to begin the reversal of dismal trade policies by this country that have hurt the American auto industry and manufacturing sector.

“Unfair and unbalanced trade policies have already put the future of the American auto industry at risk,” said Kildee.  “If China plans to enter the U.S. auto market with all the trade-distorting advantages they already possess over American producers, then Congress should step in and represent the interests of American workers.  We should start to level the playing field by leveling the auto tariff between the two countries.”

The Chinese government assigns a 25 percent tariff on every American-made cars coming to that country while the U.S. tariff on Chinese cars is 2.5 percent.  The bill Kildee and Jones introduced does not require U.S. tariffs on passenger cars to be raised nor does it require Chinese tariffs to be lowered.  It simply states that until tariff rates are equal, no Chinese-made cars may be imported into America.

While the U.S. is a heavy trading partner with China, the playing field could not be more tilted, as evidenced by the record $201.6 billion trade deficit the U.S. reported with China in 2005.  China has a slew of trade advantages over American companies that have gone unchallenged by trade officials in the White House and Congress.  These advantages include currency manipulation, repeated intellectual property rights violations, heavy government subsidies and miserable labor and environmental standards.  The tariff disparity gives China one more advantage in an already unbalanced trading relationship, one that threatens the jobs of U.S. auto workers.

China, already a net exporter of cars, reportedly plans to enter the U.S. market no later than 2008, and by 2012, it hopes to sell 100,000 cars a year in America.  In January, Geely became the first Chinese company to exhibit at the Detroit Auto Show.  In addition, other manufacturers that already export vehicles from China to Europe and elsewhere may also soon export Chinese-made vehicles to America.