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General Motors: China to the Rescue!

Shares of General Motors (GM) and Ford (F) got a lift today after China decided to cut taxes on some new-car purchases. Credit Suisse analyst Dan Galves and team explain why the move is good news for the U.S. automakers:

Bloomberg News

The China State Council announced an auto stimulus package earlier today. The key provision is a reduction in the vehicle purchase tax to 5% from 10% on vehicles with 1.6 liter engine and below. This segment represents about 70% of the approx. 19MM unit China passenger vehicle market, and we estimate...