Biden's New Tariffs On Chinese Imports Are A 'Clear Giveaway' To These Two Tesla Rivals, Jim Cramer Says: 'I Like This Policy'

CNBC host Jim Cramer has highlighted that the recent tariff hikes on Chinese imports, announced by President Joe Biden, will significantly benefit U.S. automakers, particularly Tesla Inc rivals Ford Motor Co. F and General Motors Co. GM.

What Happened: Cramer, on his show “Mad Money,” emphasized that the new tariffs will protect American car companies from the threat of cheap Chinese electric vehicles, reported CNBC.

“Not only does this tariff protect American car companies from cheap Chinese electric vehicles, it also means that their regular vehicles — their regular cars and trucks and hybrids — will benefit, too,” Cramer said. “I like this policy, but even if you hate it, it’s a clear giveaway to Ford and GM, and you got to cash in on a giveaway when you get it.”

He noted that the U.S. auto industry had been concerned about the potential impact of low-cost Chinese vehicles. However, with the new tariffs, this threat has been significantly mitigated.

The tariffs, which will see a fourfold increase from 25% to 100% on Chinese electric vehicles, are anticipated to alleviate concerns within the auto industry about the potential inundation of the market by more affordable Chinese cars.

Biden’s tariffs will also be extended to other products, including semiconductors, solar cells, masks, and medical gloves. Cramer believes that this will benefit other companies such as First Solar Inc. FSLR, Texas Instruments Inc. TXN, Owens & Minor Inc. OMI, and Becton Dickinson and Co. BDX.

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"The chief reason GM and Ford stocks sell at the bottom of the S&P 500 barrel is because of this existential Chinese threat," he said.

"Whenever China's been allowed to dump merchandise, they've destroyed pricing and destroyed companies. That won't happen here now, not with these tariffs."

Why It Matters: The Biden administration has revoked export licenses that previously allowed major American semiconductor manufacturers to supply essential chips to Huawei, marking a pivotal escalation in the U.S. strategy to curb the technological ascent of the Chinese telecommunications equipment powerhouse.

Jamie Dimon, the CEO of JPMorgan Chase & Co, also emphasized the need for "full engagement" with China, despite its competitive stance against the West. "America has the right to do things to protect itself if it think there is unfair trade," Dimon said.

Meanwhile, China strongly criticized the decision by the Biden administration to raise tariffs on a broad array of Chinese imports, pledging to retaliate with its own measures, although no details were provided. "China will take resolute measures to safeguard its own rights and interests," the Ministry of Commerce said in a statement.

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