The European Commission announced this Wednesday its intention to impose tariffs of up to 38.1% to the import of electric vehicles from China. The organization considers that the Asian giant’s battery electric cars (BEV) benefit from “unfair subsidies” and therefore pose “a threat of economic damage” to European Union producers.
This is the provisional conclusion of an investigation currently underway by the European Commission, which continues to assess “the possible consequences and impact of the measures on importers, users and consumers of BEVs in the EU”. For now, a discussion process will begin with China in this regard. If discussions with the Chinese authorities do not reach “an effective solution”, the EU will apply “provisional compensatory duties” starting July 4.
The tariffs will have three levels, depending on the manufacturer. At the moment, they have been announced for three Chinese producers: BYDto whom tariffs of 17.4% would be applied; Geely, for whom they would be 20%; and finally SAIC, which would have the highest level, 38.1%. The Commission states in a statement that other producers to cooperate in the investigation “but have not been included in the sample” will bear taxes of 21%. Those who have not collaborated With the investigations they will have the highest tariff level, 38.1%.
Sales of Chinese vehicles in the European bloc have reached 10 billion euros, which has generated concern in the European automotive industry. For this reason, accusations of unfair competition have been raised. EU representatives argue that Chinese state subsidies distort the market, negatively affecting the competitiveness of European models. According to Brussels authorities, vehicles made in China are “too cheap” due to subsidies from the Chinese government, which has allowed China to double its market share, reaching 8%.
Community services activated the import surveillances to study measurements after observing “Massive” entries of almost 200,000 vehicles between October 2023 and January 2024which represents an increase of 11% compared to the same period of the previous year, in terms of monthly average, and 14% compared to the equivalent period between October 2022 and January 2023.
The reaction of China It didn’t take long to arrive. He announced the implementation of 10% additional tariffsadding to the 15% already existing, in European products in retaliation for the criticism and possible measures of the EU. This escalation marks the beginning of a new trade war between China and the European Unionwhich according to experts, will mainly affect consumers with an increase in car prices.
The reaction of the European Union has generated doubts in some member states, such as Germany or Sweden, which fear the consequences of initiating a trade war with the Asian country. Other partners such as France and Spain have shown their agreement with the Commission’s decision. The third vice president of the Government and Minister of Ecological Transition, Teresa Ribera, has defended the need for these tariffs hours before they were announced from Brussels. “It is our obligation support the entire European automobile industry and, in particular, the Spanish one so that it continues to be a competitive, modern, updated industry with a relevant weight in international markets,” he assured this Wednesday in the Congress of Deputies.
