Buick Envision: United States denies GM’s request for a tariff exemption

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The Trump administration declined to waive a 25% tariff on the crossover vehicle in a letter to the company dated May 29 that has been published on a US government website.

The taxes are part of broader set of tariffs on Chinese exports worth $250 billion, which the United States hopes will pressure Beijing to cut a deal on trade.

President Donald Trump’s team is also considering tariffs on an additional batch of exports worth $300 billion — meaning that effectively all of China’s exports could face US duties.

In a statement, GM (GM) said it will continue to sell the Envision in the United States and is “complying with all trade rules.”

The automaker had argued that it should be exempt from paying a tariff on the Buick model because it isn’t logical for the company to make the car in the United States.

The Buick Envision on display at the Detroit Auto Show.

In 2017, GM sold five times as many Envisions in China as it did in America, according to the automaker.

“Those modest US sales would never support a manufacturing plant in the US,” the company said in its petition from July 2018.

Still, the company maintained that it is important for GM to import some of the SUVs into the United States so it can stay competitive with foreign players such as BMW (BMWYY) and Volvo (VOLAF).

GM had initially said it may need to stop offering the Envision in the United States if the tariff remains in place.

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“This would strike a significant blow to the Buick brand, as well as to dealers and consumers who have relied on Buick vehicles for over a century,” it said in its petition.

The US Trade Representative told GM that it had denied the automaker’s request because it “concerns a product strategically important or related to ‘Made in China 2025.’ ”

Made in China 2025 is an industrial program designed to reduce China’s dependence on foreign technology through investment in domestic industries and research on chips, robotics and electric and autonomous vehicles.

GM makes the Buick Envision in China’s eastern Shandong province as part of a joint venture with SAIC, a Chinese state-owned company.



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