One U.S. manufacturer said Chinese authorities on average used to inspect 2 percent of the vehicles it sent abroad. Since June, agents have taken a closer look at every product.
“Don’t expect the ‘war’ to be out in the open in some imaginary tit-for-tat tariff battlefield,” said James Zimmerman, a partner in the Beijing office of international law firm Perkins Coie LLP. “The real battle will be on the flanks”— in the form of unnecessary inspections, product quarantines and heightened regulatory scrutiny.
Supply chains will also suffer a blow, said Cliff Tan, East Asian head of Global Markets Research at Japan’s MUFG Bank in Hong Kong. The initial set of American tariffs could rock companies in the technology sector and hike the price of “Walmart-type” products.
“It’s like a war where everybody points the guns at themselves,” Tan said.