China may be preparing to levy penalties on one unnamed automaker in the United States.
The news of a penalty levy comes from the country’s official China Daily newspaper. This publication cited a senior official of the country’s state planning department as its source. The person didn’t name the United States automaker that could be affected.
The reason for the possible increase in penalties on an automaker in the United States also weren’t given. However, it may be connected to President-elect Donald Trump’s recent comments concerning the “One China” policy, reports Investing.com.
The upcoming U.S. President’s team has yet to comment on the levy penalty matter, claiming that it is still to early to do so. Trump will reportedly speak with Wilbur Ross about the issue. Ross has been chosen as Trump’s pick for Commerce Secretary.
Donald Trump has said he doesn’t see the point of sticking to the One China policy if it doesn’t include a deal for Americans. The controversy over the policy came up after the President-elect took a call from Taiwan’s president earlier this month. China considers Taiwan to be a renegade province.
Both Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM) saw their stocks drop today after the China levy penalty news broke. This may be the cause for the drop. However, it is also possible that news of auto sales dropping by 0.5% in November may be behind the decline.
F stock was down slightly and GM stock was down 2% as of Wednesday afternoon.
