EU Announces Tariffs on Chinese-Made Electric Vehicles

0:00

/1861

1×

Facts

• On Thursday, the European Union (EU) announced that tariffs on Chinese-made electric vehicles (EVs) would come into effect on Friday. The duties imposed range from 17.4% to 37.6%.¹
• The move was spurred by an EU investigation into how Chinese EVs benefit from government subsidies, with the final report alleging that subsidization has kept prices artificially low enough to harm the European auto industry and put 12M jobs at risk.²
• Firms that cooperated with the probe will be hit with an average tariff of 20.8%, while those that didn't will have to pay 37.6% on top of the existing 10% rate. Western automakers shipping from China to the EU will also be affected.³
• German automakers have broadly opposed the tariffs, with Volkswagen calling them 'detrimental,' while France and Italy have been pro-tariff. If approved by the EU's 27 members, the tariffs could be in effect for five years after November.⁴
• The European Commission estimates that the share of Chinese brands in the EU's battery-powered EV market rose from under 1% in 2019 to 8% now. Prices for Chinese EVs are an average of 20% lower than domestic vehicles.¹
• China has consistently opposed the tariffs, with the Ministry of Commerce saying on Thursday that it hoped the EU and China would eventually 'move in the same direction.' China opened an anti-dumping probe into European pork last month.²

Sources: ¹Al Jazeera, ²Euronews, ³BNN and ⁴France 24.

Narratives

• Pro-China narrative, as provided by Global Times. Free trade is fair trade, and the EU and other Western countries have determined that they can't win on a level playing field. China has become the world leader in EVs, and we all benefit from their innovative practices. European automakers will also lose out on access to the huge Chinese market, as a petty political rivalry overshadows the real value Chinese manufacturers bring to the table.
• Anti-China narrative, as provided by European Commission. Government money floods nearly every stage of the manufacturing process at Chinese automakers, and it is clear that the intent of this is to flood the market with EVs at rock-bottom prices to snuff out the EU's auto trade. These tariffs are a measured response against anti-competitive practices and are targeted to punish the least transparent and most uncooperative automakers.

Predictions