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U.S. Firms In China Committed To Market Amid Headwinds

U.S. Firms In China Committed To Market Amid Headwinds

Forbes5 days ago
U.S. President Donald Trump holds up a chart while speaking during a 'Make America Wealthy Again' ... More trade announcement event in the Rose Garden at the White House on April 2. Touting the event as 'Liberation Day', Trump is expected to announce additional tariffs targeting goods imported to the U.S. (Photo by)
More than 80% of American companies doing business in China were profitable last year and remain committed to doing business there despite rising concerns about Washington-Beijing relations and tariffs, according to a new survey by a top U.S.-China business group.
'While most U.S. companies are holding off on new investments in the near term, they remain committed to pursuing opportunities in China over the long term,' according to an annual membership survey from the U.S.-China Business Council released on Wednesday.
'Over 80% of respondents say they invest in China to serve the domestic market, while nearly all report they cannot remain globally competitive without their China operations,' the council said. In spite of headwinds, 82% of companies reported profits in 2024, the council said.
The Washington, D.C.-headquartered council represents more than 270 American companies doing business in China including multinationals such GM, Fedex, McDonald's, Harley-Davidson and Starbucks. The survey was conducted between March and May 2025, and drew from a pool of 130 members companies.
Overall U.S.-China relations continue to rank among companies' top concerns, along with tariffs, which jumped from eighth to second place amid recently renewed trade friction, the council said.
Eighty-eight percent of respondents are affected by U.S.-China relations, compared with 79% last year, and 68% have been impacted by tariffs, the council said.
Among other challenges, U.S. companies doing business in China are losing market share there as the country intensifies its rollout of industrial policies and subsidies designed to help domestic firms, the council said.
'Chinese industrial policies are boosting local competitors as American companies continue to lose market share in China,' the council said. Chinese overcapacity, once mostly confined to industrial sectors, 'has begun to impact wider swaths of the economy, including health care and consumer goods. Insufficient domestic demand and overcapacity remain the top constraints on profitability.'
Back at home, U.S. export controls and investment restrictions vis-à-vis China have also had a negative effect on business there for about 40% of respondents, the council said.
Many of those businesses are 'experiencing lost sales, severed customer relationships, and reputational damage in China to the intensifying perception that U.S. firms are unreliable suppliers,' the council said.
'Fewer than half (of survey participants) are optimistic about the future, reflecting concerns about over tariffs, deflation, and policy uncertainty,' the council said.
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