BMW’s strategic decision comes in the wake of U.S. President Donald Trump raising the stakes for China in the trade war by saying he is willing to slap tariffs on Chinese exports to the U.S. worth $200 billion.

BMW’s Chief Executive Harald Krueger stated, the carmaker has boosted the production of its X3 offroader model in China as well as in Spartanburg, South Carolina, in a step aimed at mitigating its exposure to trade tariffs between the United States and China.

“We have increased production of X3 for the U.S. market,” said Harald Krueger to analysts on a conference call to discuss its first quarter results.

BMW has begun producing the X3 offroader in China, thus ending the need for exporting this vehicle from the United States; at the same time it has also increased production in Spartanburg to meet higher demand from North America, said Krueger.

“We are less sensitive compared to other companies if trade conflicts appear,” said Krueger.

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