Electric vehicles from China face an import tariff of up to 37.6% when entering the European Union, the European Commission has announced. The provisional measures will already take effect on Friday.
After opening an investigation in September 2023, the Commission concluded that China’s electric vehicle production benefited from unfair subsidies, posing an economic threat to European manufacturers.
Starting Friday 5 July, the applied custom duties will range from 17% to 37.6%, varying according to the subsidy rate received by the manufacturers and their cooperation in the EU's investigation. The rate will stand at 17.4% for BYD, 19.9% for Geely and 37.6% for SAIC. Other Chinese manufacturers who participated in the European investigation will face an average 20.8% while those who did not cooperate will have to pay the rate of 37.6%.
In a statement released shortly after the tariffs were announced, the German automobile giant criticised the timing of the charges and argued that they "are not suitable for strengthening the competitiveness of the European automotive industry in the long term. We reject them."
The company took particular issue with the fallout the EU decision might provoke, in particular expressing concern that by limiting the supply of electric cars to European customers, the decarbonisation in the transport sector might be set back.
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The EU tariffs are in addition to the current 10% customs tax. They will be deposited in the form of a bank guarantee and can only be drawn upon if the tariffs become permanent. The EU has four months to decide on imposing definitive tariffs on Chinese vehicles.
These measures were originally announced on 12 June, but at the time were only threats. Talks commenced with Beijing in an attempt to resolve the issue. A line of communication remains open at the ‘technical level’, which aims to reach an agreement that addresses European concerns and is compatible with the World Trade Organisation.
China disputes the accusation of unfair competition and warned that these taxes could lead to a trade war.
