BMW, the largest US auto exporter, announced on Monday that it will shift production of some of its bestselling SUV models from the US to China and increase prices on US-produced cars as a result of newly imposed tariffs that make production more expensive, according to The Post and Courier in South Carolina.
BMW signed an agreement with its Chinese partner, Brilliance Automotive Group Holdings, to ramp up the number of vehicles produced in the country, with the total reaching 520,000 by 2019.
“Our agreement sets a long-term framework for our future in China — a future involving continued investment, further growth and a clear commitment to the development and production of electric vehicles,” said BMW CEO Harald Krueger said.
The German-based automobile manufacturer also said that it will raise prices for U.S.-produced SUVs sold in China because it is “not in a position to completely absorb the tariff increases” after China imposed a 40 percent tariff on U.S. car imports in response to tariffs on Chinese goods imposed by President Trump.
BMW employs 10,000 people at a plant in Spartanburg, S.C. that produces the brand’s X3, X4, X5 and X6 SUV models.
Beijing has accused Trump of launching “the biggest trade war in economic history” and of using tariffs as “typical trade bullying.”