To survive trade battles, China manufacturers deploy every weapon they can

Manufacturers in China facing trade barriers are deploying an array of moves to try to keep foreign customers - giving discounts, tapping tax breaks, trimming workforces and, occasionally, shifting production overseas to skirt tariffs.

Tit-for-tat tariffs from the China-United States trade war have been costly for many. Adding to the strain on Chinese manufacturers have been European Union duties on Chinese products ranging from electric bikes to solar panels.

March brought some encouraging news for manufacturers. Industrial output rose at its fastest rate since mid-2014 and exports rebounded more than expected, while first-quarter growth was better than expected.

Still, some manufacturers who depend on US sales are struggling. At the Canton Fair in southern China this past week, they put on a brave face, but feared they will need to take more measures to survive if Beijing and Washington fail to seal a trade deal.

Botou Golden Integrity Roll Forming Machine Co lost some US customers when tariffs pushed up prices for its machines making light steel girders and bars for building frames, according to Hope Ha, a saleswoman.

It now offers an 8 percent discount as a sweetener.

“We have to give discounts because they pay high tariffs,” said Ha.

Ball bearing maker Cixi Fushi Machinery Co gave long-term customers a 3-5 percent discount, according to representative Jane Wang.

But that was not enough, so the company suspended a product line generating USD 30,000 monthly revenue, she said.