U.S. industries lobby for easing of Biden-Harris administration's proposed China tariff hikes

As the Biden-Harris administration prepares to unveil its final implementation plans for substantial tariff increases on certain Chinese imports, U.S. industries are actively lobbying for modifications to the proposed measures. The administration faces a delicate balancing act between maintaining a strong stance on China trade and addressing domestic concerns about potential economic impacts.

President Biden initially announced in May a series of tariff hikes, including a quadrupling of duties on Chinese electric vehicles to 100%, doubling tariffs on semiconductors and solar cells to 50%, and introducing new 25% tariffs on lithium-ion batteries and other strategic goods. These measures were aimed at protecting U.S. firms from what the administration perceives as Chinese excess production.

Originally slated for implementation on August 1, the tariffs were delayed until September to allow the U.S. Trade Representative's office to review over 1,100 public comments. The final determination is expected by the end of August, marking a crucial decision point for the administration.

The timing of this decision is particularly sensitive, coming after Vice President Kamala Harris emerged as the Democratic Party's presidential nominee following Biden's decision to step aside in late July. The administration must navigate the political implications carefully, as any perceived softening on China trade could invite criticism from Republicans, while proceeding with the original hikes might draw complaints about increased costs from various sectors, including some Democrats in Congress.

Several industries have voiced concerns and requested modifications to the proposed tariffs. The Port of New York and New Jersey highlighted the potential impact of a 25% levy on Chinese-made ship-to-shore cranes, noting that it would significantly increase costs for already ordered equipment. Democratic senators from Virginia and Georgia have echoed these concerns, calling for exemptions on existing crane orders.

The automotive sector has also weighed in, with Ford Motor requesting a reduction in proposed tariffs on artificial graphite, a crucial component in electric vehicle battery production. Autos Drive America, representing foreign-brand automakers, advocated for stable tariff rates on batteries, modules, cells, and critical minerals through at least 2027 to support ongoing investments in U.S. production and foster consumer adoption of electric vehicles.

In the medical field, concerns have been raised about the planned 50% tariff on syringes, with senators warning about potential disruptions to supplies for infant feeding.

However, not all industries are seeking reductions. Some, like Finnish stainless steelmaker Outokumpu, which operates a mill in Alabama, have expressed support for increased tariffs on Chinese-made steel. The company even suggested extending higher duties to all steel products melted and poured in China but processed in other countries to prevent tariff circumvention.

The administration's decision comes at a time of ongoing diplomatic efforts to manage U.S.-China relations. U.S. National Security Adviser Jake Sullivan is set to meet with Chinese Foreign Minister Wang Yi in the same week, aiming to keep tensions in check as the November U.S. election approaches.

China has already vowed retaliation against what it terms "bullying" tariff hikes, with Foreign Minister Wang Yi suggesting that some in the U.S. may be "losing their minds" over the trade measures.