EU threatens China with tariffs of up to 38 per cent on imports of electric cars.
Everything is introduced in July – if China does not act.
But the German government is not pleased.
The EU Commission believes that Chinese state subsidies "pose a threat of economic harm to European electric car battery producers". However, there will not be an immediate tariff, even though the investigation is now complete.
On the basis of this, the Commission has now turned to Chinese authorities to discuss what has been discovered and explore possible paths towards a solution, says EU Commissioner Margaritis Schinas at a press conference in Brussels, following colleague Valdis Dombrovskis informing about the investigation that has been ongoing since last autumn.
The ball is clearly in China's court to prevent the tariffs from becoming a reality.
Introduced in July?
It is already being presented how high the tariff will be: 17.4 per cent for manufacturer BYD, 20 per cent for Volvo owner Geely, and 38.1 per cent for SAIC.
For other producers, tariffs of 21 and 38.1 per cent are being flagged, depending on whether they have cooperated with the EU's investigators or not.
"If the discussions with Chinese authorities do not lead to an effective solution, these provisional anti-dumping duties will be introduced from 4 July", says the Commission.
The EU's tariffs were expected even before the European elections, but are said to have been postponed due to disagreements and strong pressure, not least from Germany.
The government there is not satisfied.
"Cars need to become cheaper through more competition, open markets, and significantly better business conditions in the EU, not through trade wars and market isolation", writes Germany's Transport Minister Volker Wissing, from the liberal FDP, on X.
Countermeasures
China has already warned of the consequences.
This is against the principles of market economy, the rules of international trade, and undermines both the economic and trade cooperation between the EU and China as well as global car production, says Chinese Foreign Ministry spokesman Lin Jian, according to AFP.
China has previously warned of countermeasures in the form of tariffs on European agricultural products, aircraft parts, and cars. China has also already initiated investigations into whether to impose tariffs on certain types of spirits from Europe.
EU Commission President Ursula von der Leyen already warned in her annual State of the Union address in September 2023 about an upcoming investigation into Chinese electric car subsidies.
A formal investigation was launched on 4 October last year to examine the import of battery-driven electric cars.
Now that the report is complete, tariffs of between 17 and 38 per cent are being flagged, in addition to the current tariffs of 10 per cent.
The USA has simultaneously recently flagged its own tariffs on Chinese electric cars of between 25 and 100 per cent.
