EU advances with tariffs on China’s EV imports

The European Union (EU) is proceeding with plans to impose provisional tariffs on imported Electric Vehicles (EV) from China, potentially raising rates as high as 48 per cent, escalating trade tensions with Beijing.

Starting Friday, tariffs will apply to three Chinese companies sampled in the investigation. State-owned SAIC Motor Corp., maker of the MG brand, will face a 37.6 per cent tariff in addition to the existing 10 per cent rate.

Volvo Car AB’s parent company, Geely, will incur an additional 19.9 per cent, while BYD Co. will see a 17.4 per cent increase.

Other Chinese EV producers that co-operated with the investigation will be subject to a weighted average duty of 20.8 per cent. Firms that did not cooperate will face a 37.6 per cent top-up.

This move follows a similar action by the United States, which imposed a 100 per cent duty on Chinese EVs, and Canada, which is considering tariffs as well.

The EU’s move may heighten trade tensions as China responds with an anti-dumping probe on pork and considers further actions against EU agricultural goods, aviation, and auto sectors.

Talks between the EU and China have intensified, focusing on alleged subsidies benefiting China’s EV industry, which the EU claims harms its carmakers.

Tesla, which manufactures the Model 3 in Shanghai, seeks lower tariffs, advising European customers to buy before July’s expected price hike due to new tariffs.

Provisional duties are set until November, pending EU member state opposition or a resolution with China, as Chinese EV makers, like SAIC’s MG and BYD, expand in Europe with a market share under 10 per cent.

Attribution: Bloomberg.