Auto export agreements between US and China worth $1.8 billion
According to market reports world's largest US auto makers; namely, General Motors Corp, Ford Motor Co and DaimlerChrysler AG, last week reached to an agreement with
China on exporting over 15'000 vehicles for the next two years.
It is reported that world's largest automaker General Motors is going to export around 5'500 fully and 12'000-13'000 partially assembled vehicles in 2004-2005. The agreement is reportedly worth over $1.3 billion. Furthermore, the company will be allowed to import its vehicles directly. Ford plans to export 5'250 vehicles by end 2004, whereas DaimlerChrysler stated that they are going to export 4'500 units. These companies', one being the second and the other fifth largest automaker, signed export agreements worth $200 and $300 million respectively.
The main reasons why
China is chosen for such exports are that the country is the world's fastest growing vehicle market and is likely to become the third biggest vehicle market, following the US and
Japan. Besides, trade deficit over $100 billion between the US and
China can be reduced by increasing exports to the latter.