Will affect all electric vehicles made in the People’s Republic, including from Western companies.
The European Union will notify carmakers today that it will impose a provisional additional 25 percent import levy on China-made electric vehicles, according to the Financial Times (Paywall), citing people familiar with the matter. The move follows a lengthy investigation into Chinese government subsidies on EVs launched in October last year (we reported). The FT adds that the tariffs will hit all EVs made in the People’s Republic, including ones from Western companies like Tesla, Dacia, or BMW. According to research firm Transport & Environment, 19.5 percent of electric vehicles sold in Europe in 2023 were made in China, which the FT reports as roughly ten billion Euros. The additional import levy could thus cost approximately two billion Euros.
The United States also raised the levy on Chinese EVs last month, quadrupling existing tariffs from 25 to 100 percent (we reported). U.S. President Joe Biden and EU Commission President Ursula von der Leyen spoke of Chinese goods “flooding” world markets through artificially low prices on separate occasions. However, the EU was unlikely to match the U.S. rate, as the two markets differ in importance for Chinese exports. The U.S. is not a key market for EVs made in the People’s Republic, while the EU is becoming increasingly important.
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