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March 30, 2017

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Cadillac to stick to plan to sell China-made cars in US

DETROIT -- Cadillac, among the most iconic American luxury car brands, plans to sell a Chinese-made hybrid vehicle in the United States despite President-elect Donald Trump's recent offensive against foreign-made cars.

In an interview during the annual Detroit auto show, Cadillac President Johan de Nysschen said manufacturing a new plug-in hybrid in China — where the market for alternative drivetrain vehicles is far larger than in the U.S. — made more business sense than having assembly plants in both countries.

"The CT6 plug-in actually has quite a bit of U.S. content in the car but nevertheless in terms of manufacturing tooling, it made economic sense to tool up only one plant for what still is a low-volume car," he told AFP.

"It would not have at all been economically feasible to tool up twice and so we are faced with a question: Either we don't bring the car to the U.S. at all or we import it in low volume from China."

Cadillac, a unit of General Motors, produces the CT6 near Shanghai and the car is expected on U.S. markets in the spring, making it the second GM model to be built in China and sold in the U.S.

Trump has recently attacked auto makers for seeking to import cars made in Mexico with lower-cost foreign labor, threatening them with stiff tariffs and casting a long shadow over the start of this year's international auto showcase.

Though outmatched in the U.S. market by German and Japanese luxury brands seen as more prestigious, wealthier car buyers in China have given Cadillac a boost.

Sales in China rose 43 percent in the first 10 months of 2016 to 89,530 units but fell 5.6 percent in the United States to 133,234.

In the event of a trade war between China and the United States, Cadillac could simply stop imports of the CT6, de Nysschen said.

"And then the car would be produced only for the China market."

Sales of electrified vehicles represented fewer than three percent of the U.S. market in 2016 and Cadillac would not envision a significant effect on its revenues in such a scenario, he added.

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