The European Commission said it will impose extra duties of up to 38.1% on imported Chinese electric cars from July, risking retaliation from Beijing which said on Wednesday it would take measures to safeguard its interests.
Less than a month after Washington announced plans to quadruple duties for Chinese EVs to 100%, Brussels said it would combat excessive subsidies with additional tariffs ranging from 17.4% for BYD (SZ:002594) to 38.1% for SAIC, on top of the standard 10% car duty.
That equates to billions of euros of extra costs for the carmakers at a time when they are struggling with slowing demand and falling prices at home, according to Reuters calculations based on 2023 EU trade data.
European automakers, meanwhile, are being challenged by an influx of lower-cost EVs from Chinese rivals. The Commission estimates their share of the EU market has risen to 8% from below 1% in 2019 and could reach 15% in 2025. It says prices are typically 20% below those of EU-made models.
Andrew Kenningham, chief Europe economist at Capital Economics, said the EU decision marked a big change in its trade policy because, although it used trade defences against China often, it had not done so for such an important industry.
European policymakers are keen to avoid a repeat of what happened with solar panels a decade ago when the EU took only limited action to curb Chinese imports and many European manufacturers collapsed. The EU launched an anti-subsidy investigation into Chineses EVs in October.a
Source: Investing