What has been brewing for a long time is now a done deal: As of this Wednesday, the EU will impose additional taxes on electric vehicles imported from China – against resistance from Germany.
The EU additional tariffs on imports of electric cars from China finally come into force despite resistance from Germany. The EU Commission passed the necessary regulation, as can be seen from a document. With publication in the EU Official Journal, the measures will come into force on Wednesday.
A sufficiently large majority of EU states had previously voted in favor of the punitive tariffs at the beginning of the month. Germany voted against it – out of concern about a new major trade conflict and possible retaliation against German manufacturers. From the European Commission’s perspective, the countervailing duties are necessary to secure the long-term future of the auto industry in the EU.
EU authority: Unfair subsidies for manufacturers from China
In an investigation, competition watchdogs from Brussels came to the conclusion that Chinese manufacturers benefit from unfair subsidies that give them a significant advantage on the European market. Accordingly, Chinese electric cars can usually be offered around 20 percent cheaper than models manufactured in the EU. The EU Commission therefore introduced provisional countervailing duties in July. An additional tax of 17.0 percent will now apply to electric cars from the manufacturer BYD, as the regulation shows. For electric vehicles from the manufacturer Geely, 18.8 percent is due. The maximum rate is 35.3 percent.
Negotiations about a possible amicable solution to the trade dispute remained unsuccessful until the end. One option seen is that e-car dealers can enter into price commitments and thus avoid tariffs.
German car manufacturers fear China’s reaction
It is still unclear how China will react to the final imposition of the tariffs. The government in Beijing accuses the EU of protectionism and has in the past threatened to impose higher tariffs on the import of large-displacement combustion engines from the EU into the People’s Republic. German car manufacturers would be particularly affected by this. As a possible retaliatory measure, China also began to consider additional taxes on the import of pork and dairy products.
The trade dispute is a big issue for German industry because China is the largest car market in the world and companies fear losing one of their most important sales markets. German companies such as VW, Mercedes and BMW not only produce cars there specifically for the Chinese market, but also for export.
Car manufacturer: Electromobility is being slowed down
The automobile industry association warned that the tariffs not only increase the risk of a mutual trade conflict, but also make vehicles more expensive for consumers. In addition, the ramp-up of electromobility and thus the achievement of climate goals will be slowed down in a “particularly critical phase,” said a spokesman.
At the EU Commission in Brussels, on the other hand, there is an assessment that this position is primarily dominated by top managers of the car manufacturers. They are accused of wanting to achieve good numbers, especially in the short and medium term, and not having much of an eye on the long-term survival of the auto industry.
