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China Rules U.S. Carmakers Guilty of Dumping

Beijing decides not to issue penalties.

by on May.10, 2011

A Chevy Volt at the Shanghai Expo. While GM is accused of dumping, new Chinese rules will likely restrict Volt's appeal in that market.

U.S. automakers are receiving unfair subsidies that amount to illegally dumping cars on the Chinese market, Beijing regulators have ruled.

Chinese authorities have decided they will not levy penalties against the American makers cited by the complaint – ostensibly to avoid triggering a new trade dispute between the two countries.  But the timing of the action raises concerns in that American makers have been sounding alarm over new rules they feel might impact their ability to market products in China by unfairly protecting domestic carmakers and suppliers.

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“China’s domestic car industry … has suffered substantial damage,” said a statement from China’s Commerce Ministry, following the completion of an investigation that began in November 2009.

The investigation was launched on behalf of Chinese domestic automakers who complained about U.S. imports – which tripled in value to $3.4 billion between 2009 and 2010.