Car parts trade tariff threats

Tesla recently complained that the U.S.-China trade war hurts its ability to import needed parts from China as components for its cars. hanse data show that China has been increasing its share in U.S. motor cars parts imports second only to Mexico between 2007 and 2017. Global success factors dominate but differential regional supply chain patterns have emerged.. 

China increased its share in U.S. car parts, HS 8708 motor vehicles; parts and accessories, from 8.3 percent in 2007 to 14.9 percent in 2017. Mexico remains the largest and fastest growing force in car parts increasing its share from 21.8 percent in 2007 to 34.5 percent in 2017 (Figure 1). Car parts expanded their share in total U.S. imports from 2.3 percent in 2007 to 2.8 percent in 2017 trailing motor cars (HS 8703 motor cars and other motor vehicles; principally designed for the transport of persons) with a share in total U.S. imports of 6..8 percent and 7.5 percent, respectively .

Figure 1. U.S. car part imports

EU15 imports in car parts are more important than in the U.S. representing 5.6 percent of total EU15 in 2017 and 6.1 percent in 2017. China is a smaller player representing 3 percent of EU15 imports in car parts.. 

Japan imports in car parts are relatively small representing 0.9 percent of total Japanese imports in 2007 and 1.2 percent in 2017. Similarly, car imports represent 1.2 and 1.7 percent of total imports, respectively. China has by far the dominant and fastest growing share in Japanese car part imports increasing from 22.5 percent in 2007 to 36.3 percent in 2017 (Figure 3).

China’s imports in car parts are similarly small representing 1.1 percent in 2007 and 1.6 percent in 2016.  Germany maintains the largest share in China’s car part imports with 30.7 percent in 2016.. Korea is the fastest growing country with its share in car parts increasing from 12.2 percent in 2007 to 17.0 percent in 2016.

Figure 2. EU15 car part imports

Figure 3. Japan car part imports

Figure 4. China car part imports

The car part sector shows regional supply chain patterns. The comparison of the fastest growing countries in U.S., EU15, China and Japan imports shows common global success factors in car parts. Mexico and Korea are the two countries among the fastest growing in all markets. China, Czech Republic, Poland, Vietnam and Thailand compete successfully in 3 markets; Romania, Slovakia and Hungary in 2. Regional patterns also exist like Austria for the EU15, Germany and the U.S. for China and Spain, Sweden and Malaysia for Japan.