EU Commission imposes provisional punitive tariffs on imports of electric cars from China from Friday
Accompanied by criticism from Germany, the EU Commission will impose provisional anti-subsidy duties on imports of electric vehicles from China starting from this Friday. "These provisional duties will apply from July 5th for a maximum duration of four months," the EU agency announced in Brussels on Thursday. The Commission had previously announced the tariffs on the existing rate of ten percent and justified it with high subsidies from the Chinese government for electric vehicle production throughout the value chain. This creates an unfair advantage over the European automobile industry and threatens its successful transition to electric vehicles.
Compared to the initial announcement, the EU Commission slightly reduced the highest tariff to 37.6 percent from originally 38.1 percent in response to objections to its calculation. This tariff applies to automakers that did not cooperate with the EU investigation nine months ago, such as Volkswagen's partner SAIC. The lowest additional tariff for automakers collaborating with the EU was also reduced slightly to 20.8 percent. Geely, a shareholder and partner of Mercedes-Benz, will pay 19.9 percent more in import tariffs. This also applies to electric vehicle imports from Tesla or European manufacturers, such as BMW's electric Mini. The German automobile industry warned that the EU would worsen trade relations and ultimately weaken its own automobile industry with this step.
The Chinese government criticized the EU decision and threatened countermeasures. Simultaneously, working-level talks were initiated to find a solution within the framework of the World Trade Organization (WTO). "Every result of the investigation must effectively address the identified forms of subsidization," the EU Commission declared. The EU will make a final decision on the tariffs by November for companies that have not yet paid them but are obligated to do so.
- Despite the criticism from Germany, the EU Commission still decided to implement punitive tariffs on Chinese imports of electric cars starting on Friday.
- The Chinese government expressed its displeasure with the EU's decision to impose punitive tariffs, threatening countermeasures in response.
- Despite the reduction in the highest tariff rate, automakers like Volkswagen's partner SAIC, Geely, and Tesla will still face higher costs due to the punitive tariffs on electric car imports from China.
- Despite the EU Commission's justification for the tariffs due to Chinese government subsidies, the move has raised concerns about worsening trade relations and potentially weakening the EU's own automobile industry.
