The European Commission has done what it threatened to do, adding large tariffs on Chinese-made electric cars. In a statement it said that it has “obtained the necessary support from [European Union] member states for the adoption of tariffs”. Moreover it says that the move represents the next step in its investigation into the subsidisation of EVs by the Chinese government.
The EU said that it will work with Chinese authorities to develop an “alternative solution”. However, this would have to be “adequate in addressing the injurious subsidisation established by the Commission’s investigation”.
The EC introduced temporary tariffs on Chinese EVs in July, and has now made these permanent. It suggested that the introduction of cheap Chinese EVs could “cause a threat of economic injury to EU BEV producers”.
SAIC’s MG was hit hard because they said the company failed to co-operate with the Commission’s investigation. It received the highest rate of 35.3 per cent on the wholesale price of its EVs, in addition to the 10 per cent it was already being charged.
BYD is charged an extra 17.4 per cent while Geely (owners of Lotus, Polestar and Volvo) incurs a 19.9 per cent rate.
The fees of up to 45 per cent will apply to Chinese EVs for the next five years.
About one-third of the EC voted for the added tariffs, one-third against and the rest abstained.
Several European car makers have been outspoken about the introduction of tariffs. Skoda said “We don’t think that the tariffs can solve the situation.” That’s because Chinese manufacturers will instead build factories in Europe to circumvent the tariffs. BYD, Chery and the Stellantis-backed Leapmotor have already set up production hubs in the region.
A BYD spokesperson said the tariffs will only be effective temporarily for the brand. “In less than a year from now, we will become officially a European manufacturer.”
Skoda said a better fix is for the EU to fund its home-grown car manufacturers to compete with the Chinese more effectively. Stellantis chief, Carlos Tavares, agreed saying European firms should try to be more like the Chinese car markers.
This will close in 8 seconds
