Aug 2, 2018

The big picture: Automakers invest in China due to Trump's trade war

A Tesla car charging in Beijing. Photo: Zhang Peng/LightRocket via Getty Images

American-made cars are among the hardest-hit products in the U.S.-China trade war, facing a 40% import tariff in China — and some automakers are weathering the storm by doubling down on Chinese operations.

Why it matters: Moving into China is a natural step for big automakers looking to crack the world’s fastest-growing car market, but tariffs provide a big incentive to accelerate those plans. Their investments in factories and in research and development on Chinese soil could give China a long-term advantage when it comes to building the electric and autonomous vehicles of the future.

The big picture

BMW expects a 5–10% bump in Chinese sales this year, despite tariffs, because it has shifted manufacturing to Asia, Reuters reports.

  • The automaker now builds X3s intended for the Chinese market in China, so it doesn't have to export the model from Spartanburg, South Carolina. That raises the total number of BMW models manufactured in China to six. BMW also imports its X5 to China from Thailand.

Tesla wants to build a massive Chinese factory in part to weather the trade war.

Volkswagen is partnering with China as it plots its move to electric vehicles.

  • Volkswagen says it will invest $12 billion in the Chinese market by 2025, per Bloomberg, and expects China to be the largest market for its electric vehicles.

The bottom line: While the Trump administration launched a global trade war with the goal of bolstering U.S. manufacturing, the trade war's unintended consequences could far outlast the conflict itself.

Go deeper

World coronavirus updates: Italy becomes 2nd country to exceed 100,000 cases

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

Spain and Italy extended lockdown deadlines on Monday, as Italy became the second country in the world to surpass 100,000 confirmed coronavirus cases.

The big picture: COVID-19 cases surged past 755,000 and the death toll topped 36,000 by Monday, per Johns Hopkins data. Italy reported more than 11,500 total deaths.

Go deeperArrowUpdated 10 mins ago - Health

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 1 p.m. ET: 745,308 — Total deaths: 35,307 — Total recoveries: 156,875.
  2. U.S.: Leads the world in confirmed cases. Total confirmed cases as of 1 p.m. ET: 143,672 — Total deaths: 2,575 — Total recoveries: 4,865.
  3. Federal government latest: The White House will extend its social distancing guidelines until April 30 — Hospital ship the USNS Comfort arrives in Manhattan.
  4. Business latest: Macy's will furlough the majority of it's workers this week, as the chain's stores remain closed.
  5. World updates: Spain and Italy extend lockdown deadlines while Italy becomes second country to surpass 100,000 confirmed cases.
  6. 🎧 Podcast: Living with the coronavirus
  7. What should I do? Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk
  8. Other resources: CDC on how to avoid the virus, what to do if you get it.

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U.S. coronavirus updates: Majority of governors order residents to stay home

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios

At least 29 state governors have ordered their residents to stay home to promote social distancing and limit community spread from the coronavirus pandemic as the U.S. copes with more than 144,000 positive cases — more than any other country in the world, per Johns Hopkins data.

The big picture: COVID-19 killed over 2,500 people in the U.S. by Monday. That's far fewer than in Italy, where over 10,700 people have died — accounting for a third of the global death toll. The number of people who've recovered from the virus in the U.S. exceeded 4,800.

Go deeperArrowUpdated 37 mins ago - Health