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Abstract

The Sino-US trade war began from late 2017 has had large influence on the global economy. After US imposed sweeping tariffs on Chinese imports for illegal unfair trade practice in 2018, China also launched retaliatory tariff to fight back. This study is mainly focus on the automobile and parts industry, which is one of the significant industries influenced by this trade war. Except analyzing the US manufactures, Germany, Korean and Japanese exporters who gain tariff relief are also included to establish a comparison with US firms in this research to analyze how net weight (kg), trade values ($) and unit price ($) be affected due to the changes in trade tariff. In addition, firm level data from those four countries are also used to show the fluctuation of sales of both imported and domestic produced foreign brand vehicles. From the result, although significance is shown that the China’s retaliatory tariff do have influence on US automobile and parts exports, the coefficient is positive which did not meet my original expectation. However, the analysis on other countries (German, Japan and Korea) shows that the relief in tariffs help to increase export quantities and values. Finally, the firm level data analysis shows that imported vehicles experienced a generally decreasing trend as more and more companies established foreign-affiliated firms and move their manufacturers into domestic China to better serve the Chinese market.

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