The European Commission announced this Wednesday, June 12, that it will temporarily impose customs duties of up to 38% on imports of Chinese electric vehicles, a decision that should provoke China’s anger and possible retaliation.
MG hits hard, less BYD
The European executive, responsible for the Union’s trade policy, indicated that customs duties, which are likely to be introduced at the beginning of July, would amount to 17.4% for the Chinese car manufacturer BYD and 20% and 38% , respectively. for their compatriots Geely and SAIC (MG brand).
Other companies that cooperate with investigations will be charged customs duties of 21%, compared to 38.1% for companies that do not cooperate with investigators.
This decision comes after an investigation opened last October into subsidies that allegedly benefit Chinese car manufacturers in Beijing.
“As part of its ongoing investigation, the Commission has provisionally concluded that China’s battery electric vehicle (BEV) value chain benefits from unfair subsidies, posing a threat of economic harm to consumers. producers of electric cars in the European Union,” points out the Commission’s press release.
Amid the electrification of their range, European carmakers are facing an influx of less expensive to produce electric vehicles from their Chinese competitors. Europe now has until July 4 to reach an agreement with China:
“If discussions with the Chinese authorities did not lead to an effective solution, these provisional countervailing duties would be introduced from 4 July by means of a guarantee (in the form to be determined by the customs of each Member State). They would not only be collected as long as when definitive duties are imposed,” the statement continued.
Expected retaliation
These customs tariffs are expected to significantly increase the costs of Chinese electric cars sold in Europe, but also risk increasing trade tensions with China, which has already threatened retaliation.
On Wednesday, China’s foreign minister warned that it would take measures to “firmly defend” its interests.
Asked about this announcement, a spokesperson for the Chinese Ministry of Foreign Affairs, Lin Jian, considered that “this anti-subsidy investigation is a typical case of protectionism,” notes AFP.
“The EU uses this as an excuse to impose customs duties on electric vehicles imported from China,” he lamented during a regular press conference.
“This goes against the principles of market economy and international trade rules, undermines economic and trade cooperation between China and the EU, as well as the stability of global automobile production and supply chains,” Lin Jian stressed, adding that, “ultimately, this would be detrimental to the European Union’s own interests.”
The Chinese Chamber of Commerce before the EU (CCCEU) had already indicated that Beijing had “prepared many countermeasures.”
China already responded in January with an investigation targeting all wine spirits imported from the European Union, including cognac in particular. Wine, dairy products, pork and high-engine cars are also in the spotlight, according to Chinese state media.
The EU investigation is under pressure from the United States, which is seeking a common front against China, which it has designated as its rival.
Source: BFM TV
