European Union imposes customs duties of up to 38% on Chinese electric cars

 

The European Union conservatively imposed tariffs of up to 38% on imported Chinese electric cars on Thursday ahead of a final decision in November, the European Commission said, accusing Beijing of illegally supporting manufacturers of the vehicles.

The new tariffs, which come on top of another 10% already imposed on Chinese cars, will take effect on Friday.

Following a wide-ranging investigation into Chinese government subsidies to the electric vehicle industry that began in October 2023, Brussels announced these new tariffs on June 12, while also opening talks with Beijing to resolve the issues identified and defuse the risk of a trade war.

The Commission has four months to decide whether to impose these new fees once and for all, leaving the door open for a possible dialogue with Beijing. This final fee will be in place for five years.

Brussels is following in the footsteps of Washington, which in mid-May announced a 100 percent increase in tariffs on Chinese electric cars, up from 25 percent.

The European car industry, which is a leader in the production of gasoline and diesel engines, fears a decline in its industry if it does not stop the announced increase in the proportion of cars produced in China, which is making significant progress in the field of electric cars.

Cars from China represent about 22 percent of the European market, up from 3 percent three years ago, according to industry estimates. Chinese brands account for 8 percent of electric cars sold in the European Union.

Based on its investigations, Brussels concluded that China's electric vehicle sector "benefits from unfair subsidies that threaten to cause economic harm to European producers."