Yesterday, the Chinese government announced that it will impose an additional 34% import tax on all American-imported goods, including vehicles, in response to the recent tariff policy introduced by the Trump administration.

This countermeasure, set to take effect on April 10th, will significantly increase the cost of American-made sports cars such as the Corvette C8 and the new 5.0-liter Mustang. The comprehensive tax rate on the Corvette C8 Z06 is expected to reach 200%, pushing its price in China to over 220,000 USD, which does not even include the dealership’s profit.

The tax was previously raised in February, when the Chinese government imposed an additional 10% tariff on all American-made vehicles with engines larger than 2.5 liters. The added tax also applied to German luxury models manufactured in the U.S., including the BMW X6, X7, and the Mercedes-Benz GLS-Class—models that are among the best sellers in China’s luxury SUV market. In 2024, the Mercedes-Benz GLS sold 13,985 units in China, ranking second, while the BMW X7 recorded 7,331 units sold, ranking third.

The Ford F-150’s price is also heavily affected by the new tariff, but its sales in China have already been on a downward trend. It sold 4,954 units in 2023, dropping to just 2,227 units in 2024—a significant 50% decrease. Beyond pricing, this decline is largely attributed to the rise of Chinese luxury off-road models, such as BYD’s Yangwang U8 and GWM’s Shanhai Pao (also known as GWM Cannon Alpha in the global market), which are gaining popularity among domestic consumers.

The new 34% import tax will significantly impact the import dealership business at Tianjin Port, the largest trading hub for imported luxury vehicles in China. In 2019, the annual imported vehicle volume through Tianjin reached as high as 150,000 units. However, with the rise of domestic luxury brands like Yangwang, sales have declined sharply, dropping to around 39,300 units in 2023. The latest tariffs will undoubtedly deal another heavy blow to an already struggling market.