The new tariffs on Chinese imports into the U.S., on electric vehicles, will take effect on August 1

The tariffs on imported Chinese vehicles will grow from 25% to 100% including BEVs of all sizes, as well as plug-in hybrids. Batteries from China will also have increased tariffs. Batteries will increase from 7.5% to 25% and are due to start on January 1, 2026. 50% tariffs on semiconductors start January 1, 2025.

The United States imported $427 billion in goods from China in 2023.

The restrictions on electric vehicles from China are expected to result in China making those vehicles in Mexico. BYD, China’s largest EV auto maker, which recently surpassed Tesla as the world’s biggest seller of electric vehicles, is advancing on building plants in Mexico allowing it to bring its low-cost electric vehicles into the United States. Mexico offers proximity to U.S. and relatively low labor costs.

 Chinese EV makers including BYD are shipping vehicles to Mexico and Brazil.

The Chinese EV maker is also accelerating construction of its plant in Brazil to tap the booming local market, which also factored into the recent rise in shipping demand. BYD has said it also plans to build a new plant in Mexico for the market there.

Jeffrey Newman is a whistleblower lawyer, whose firm represents whistleblowers in healthcare fraud cases under the False Claims Act (FCA) and also under the Securities and Exchange, FINCEN and CFTC whistleblower programs. He can be reached at Jeff@JeffNewmanLaw.com or at 617-823-3217