EU provides China with temporary leeway to hike tariffs on electric vehicles.
The EU Commission is giving a reprieve to China in the conflict over subsidies for electric cars due to Germany's insistence. Negotiations will be held up until early July between the EU Commission and Chinese authorities and individual manufactures on a temporary hike in tariffs. These could go into effect under certain circumstances post-July 4th. There were concerns of trade disputes with China as the German government and local automakers feared penalties.
The EU Commission revealed on Wednesday that results of its ongoing investigation into China's electric cars indicated they were getting "unfair subsidies." This could potentially harm EU producers.
In the event of no agreement during talks with China, the base tariff of ten percent on electric cars from China can raise considerably. For BYD, the surcharge would be 17.4 percent, Geely faces 20 percent, and SAIC has to deal with a 38.1 percent rise. The Commission detailed that if negotiations with Chinese authorities don't yield a practical solution, "temporary compensatory tariffs" would be introduced from July 4th, with the implementation method determined by each EU nation.
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The temporary leeway granted by the EU Commission allows China to increase tariffs on electric cars, but this is a contentious issue due to concerns about unfair subsidies and potential trade disputes. The discussions between the EU Commission and Chinese authorities, as well as individual manufacturers, are scheduled to continue until early July. If no agreement is reached, higher tariffs could become effective after July 4th, with a base tariff of 10% potentially increasing for companies like BYD, Geely, and SAIC.
