The Alliance for American Manufacturing has alleged that the Chinese government has been providing illegal subsidies to China-based auto parts manufacturing facilities, which has in turn made it much harder for US based auto part makers to compete.
The alleged subsidies mean Chinese manufacturers can sell auto parts to US car manufacturers at much lower prices, which, says the AAM, has caused the loss of 400,000 jobs since 2000. It has argued that if action is not taken, a further 1.6 million jobs could be at risk.
The Chinese have been accused of using a variety of so-called underhand techniques to give its companies and factories the upper hand over rivals - particularly those in the west. They have purportedly kept the value of the Yuan low in order to make its exports cheaper to buy.
The combined effect of these moves is an escalation in tensions between the US and China over various aspects of trade - especially the automotive industry.
It seems the days when China was thought of as a producer of second-rate products is over (one would have made double sure one had breakdown cover for a Chinese-made car in the past) - but now many US and European cars contain Chinese parts - because they are cheap and of a high standard.
The US has recently set up a new body to look into suspect trade practices of nations such as China. Time will tell if it has any impact.
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