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EU agrees to impose tariffs on Chinese electric cars

05.10.2024 08:17
European Union member states agreed on Friday to introduce tariffs on Chinese electric cars, a source in Brussels told Poland's national press agency PAP. The reason cited is Beijing's subsidisation of production, making the competition in this market sector unfair.
A China-made electric vehicle (illustration image)
A China-made electric vehicle (illustration image)Tim Wu / Wikimedia Commons (CC A-S A 4.0)

Germany, Hungary, Malta, Slovenia and Slovakia opposed the introduction of tariffs, while Belgium, the Czech Republic, Greece, Spain, Croatia, Cyprus, Luxembourg, Austria, Portugal, Romania, Sweden and Finland abstained from voting. The remaining ten EU countries, Poland included, were in favour - the PAP agency informed.

Such a vote result means that the European Commission's proposal received sufficient support to introduce fixed tariffs on electric cars from China for five years. A qualified majority of fifteen member states, representing 65% of the bloc's population, was needed to block this outcome.

Later on Friday, the European Commission indeed announced that it had received sufficient support from the member states to impose tariffs, which will range from 7.8% to 35.3%, depending on the manufacturer. When determining the said fees, the EC also took into account whether a company had cooperated with the investigation into the subsidies or not. The newly imposed tolls will be added on top of the European Union's standard 10% import duty on cars.

The EC announced that it would continue negotiations with Beijing to find an alternative solution.

Reuters quoted the BMW CEO, Oliver Zipse, describing the vote as a "disastrous signal for the European automotive industry" - and adding that "a quick agreement between Brussels and Beijing was necessary to prevent a trade conflict". Volkswagen leaders also described the introduction of tariffs as "the wrong approach".

China's Foreign Ministry did not respond to a request for comment.

China is the world's largest producer of electric vehicles, and its exports of such vehicles increased by 70% in 2023, reaching $34.1 billion. Meanwhile, the EU is the largest recipient of electric vehicles from China, accounting for almost 40% of Chinese exports in this regard.

In 2023, EU countries bought Chinese cars worth €3.5 billion, almost 40% more than in the previous year. This has raised concerns in the EU and some EU capitals, as Chinese electric cars are typically 20% cheaper than comparable models made in the EU.

The EU’s stance towards Beijing has hardened over the past five years. Brussels sees China as a potential partner on some issues, but also as a competitor and systemic rival on others.

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Source: PAP