BMW Follows Tesla in China Price Rise as U.S. Auto Exports Head Into Reverse — Panjiva
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BMW Follows Tesla in China Price Rise as U.S. Auto Exports Head Into Reverse

China 1758 Cons. Discr. - Autos 661 Tariffs 1169 U.S. 3297

Automaker BMW has increased the sales price of its X-series of SUVs in China by 5% to 7%, the Financial Times reports, in response to duties applied by the Chinese government in retaliation for America’s section 301 duties. As outlined in Panjiva research of July 9 BMW’s move follows an 18% rise implemented by Tesla for its S-series immediately after the duties’ implementation while Daimler has indicated there will be a reduction in vehicle sales as a consequence of the duties.

Panjiva data shows U.S. exports to China of large-capacity cars (gasoline and diesel) such as BMW’s X-series reached 221,000 units in the 12 months to May 31, or 11.7% of the total. That followed a decline in shipments of 29.2% in the three months to May 31 on a year earlier vs. a 7.2% increase in total shipments. The average value per vehicle of the exports reached $34.7k over the 12 month period, or just 1.7% higher than a year earlier.

FOUR YEARS OF DECELERATION FOR CHINESE IMPORTS OF AMERICAN CARS AND TRUCKS

Chart segments U.S. exports of large-engined vehicles by destination on a monthly (dotted) and quarterly average (solid) basis.   Source: Panjiva

Exports from the U.S. accounted for 27.6% of BMW’s total Chinese imports in the 12 months to February 28, with completed vehicles accounting for 95.8% of U.S.-outbound shipments. One alternative may be for the company to shift assembly of the vehicles from the U.S. to another factory including its China joint venture or factories in Brazil or Egypt where “knockdown” component strategies are used.

ULTIMATELY THERE ARE OTHER SOURCES OF DRIVING MACHINES FOR BMW IN CHINA

Chart segments Chinese imports associated with BMW by country of origin and product (HS-6) in the 12 months to February 28, denominated in dollars.   Source: Panjiva

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