China-Us Trade War: US Auto Sector Braces for China Tariff Fallout As Ev Rivals Surge

A pickup in China’s Economy May Lift Demand for US GOODS. However, An Escalating US-CHINA Trade War Could Push Chinese Consumers Town Domestic Brands. Durying Trump’s First Term As President, The US-CHINA TRADE WAR LED TO A NANDALICALIC REESPONSE, PARTICULARLY IN SECTORS LIKE SMARTPHONES.

Mounting Recession Risks Could Pressure The Us Administration to Ease Trade Tensions with China to Prevent Retaliatoria Consumer Boycottts. The Latest Shift in Sentiment Toward the US Economy May Pressure Washington Into Making Concessions in Future Tariff Talks, Potentilly Giving Beijing an Advantage.

Natixis Asia Pacific Chief Economist Alicia Garcia Herrero Commented On the Potential for Diplomatic Engagement:

“Given the Stock Market Collaps in the US Thanks to Trump Admitting the Possibility of Recession and Tesla’s Huge Correction, Trump and Musk Musk Might Be UNING THAT. A visit to beijing is in the air … ”

US AUTO ManUFACTURERS FACE Tariff-Driven Headwinds Beyond the Smartphone Sector, US Automakers Could Face Challenges from Shifting Chinese Consumer Preferences. General Motors (GM) Relies Heavily on the Chinese Market. China has become One of Tesla’s (Tsla) Largest Markets and A Crucial Export Hub, While Ford (F) Considers China a Critical Growth Market.

Since Trump’s First Term, Chinese Automakers Have Made Significant Advancements, Benefiting from Surging EV Demand. Leading Players, Including Byd (HK.1211), NIO (HK.9866), And Li Auto (HK.2015), Have Become VIBLE COMPETITORS TO TESLA AND Other US Automakers. This Evolution Could Pressure The Us Administration to Seal A Deal with China.

Beijing’s Stimulus Measures, Aimed at Boosting DOMESTIC CONSUMPTION, POSION CHINA AS A KEY Market for US Automakers, Particularly If The US Enters A Recession. The US Auto Sector Contributes 3-5% to US GDP and Directly or Indirectly Employs AROUND 5 MILLION WORKERS.

On March 9, The Kobeissi Letter Highlighted the Darkening Clouds for the US Auto Sector:

“The Share of Subpri -Car Borrowers at Least 60 Days Past Due on Their Loans Hit 6.6% in January, The Highest in at Least 30 Years. […]. Levels Now Exceed Levels Seen in 2020, 2008, and The Previous Peak Recorded in 1996.

Considering the Dynamics, The US Administration May Face Challenging Trade Talks. China’s Foreign Minister Recently SAID THAT IF The US INSISTS ON WAGING A TRADE OR TARIFF WAR, China Will See It Through To The End.

China’s Transition to A Consumer-Driven Economy and Us Goods Last Week, Beijing Released ITS 2025 WORK REPORT, OUTLINING ECONOMIC TARGETS AND PLEDGING MONETARY AND FISCAL Policy Support. These Measures Are Part of China’s Bigger Goal of Transitioning from An Export-Relyant to A Consumption-Pel Economy. While this Reduces China’s Dependence on Overseas Demand, DOMESTIC CONSUMPTION COULD Boost Demand for National and International Brands, AFFECTING US BUSINESSES RELIANT on Chinese Consumers.

For the US Auto Sector – A Key Indicator of Broader Labor Market Trends – China’s Evolving Economic Policies Could Be Crucial.

Market Moves: Hang Seng Index and Mainland Markets Face Modest Losses Despite Monday’s US Market Sell-Off, Hong Kong and Mainland China-Listed Stocks posted Modest Losses on Tuesday, March 11.

The Hang Seng Index Fell 0.34%, While the Mainland’s CSI 300 and Shanghai Composite Index Droped 0.41%and 0.32%, Respectively. Meanwhile, The Buying Frenzy for Tech Stocks Continued, with The Hang Seng Tech Index Up 0.89%.

Hong Kong-Listed Auto Stocks Li Auto and BYD SAW FURTHER GANS ON MARCH 11, Giving Year-To-Date Gains of 19% and 31%, Respectively. In Contrast, General Motors Was Down 9.74% Year-To-Date, With Tesla Tumbling 45%.