Tesla, Volvo, Ford and Mercedes sue US over ‘unlawful’ tariffs on Chinese parts

Tesla, Volvo, Ford and Mercedes-Benz have filed lawsuits against the Trump administration, aiming to end what Elon Musk’s electric car manufacturer called “unlawful” tariffs imposed on certain parts imported from China.

The lawsuits, filed in New York this week, target the 25% tariffs imposed by the US trade representative on a list of products including spare parts such as terminals.

Tesla’s filing to the Court of International Trade said the leveies were “arbitrary, capricious, and an abuse of discretion”.

The suit names the US trade representative, Robert Lighthizer, as a defendant. His office last year turned down Tesla’s request to be exempted from tariffs on computer and display screens imported from China that it uses in its Model 3 electric car. The company, which was funded by Elon Musk, said it would be harmed by having to pay higher costs for components.

Tesla seeks their cancellation along with a “refund, with interest” of duties already paid, according to the filing.

In its filing, Mercedes accused the Trump administration of “prosecution of an unprecedented, unbounded, and unlimited trade war impacting over $500bn in imports from the People’s Republic of China”.

It argued US law “did not confer authority on defendants to litigate a vast trade war for however long, and by whatever means, they choose”.

The tariffs comes amid a wider trade dispute between Washington and Beijing, and

The levies were imposed as part of an effort by Washington to wean its manufacturers off Chinese technology and reduce the yawning trade deficit with China.

The US and China engaged in months of trade conflict after Trump took office in 2017, and despite a “phase one” deal signed earlier this year marking a partial truce in the dispute, additional tariffs of 25% remain on the equivalent of $250bn in Chinese goods.

Beijing has retaliated for these levies, while Washington is aiming both to reduce its trade deficit and reform Chinese commerce practices it considers “unfair”.

The US commerce department reported the country’s trade deficit in July surged nearly 11% to $63.6bn, with the deficit with China climbing to $28.3bn.

China is the world’s biggest auto market and the main growth driver for many car manufacturers – especially for Tesla, which intends to benefit from the country’s ambitious targets for reducing CO2 emissions.

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