Europe to triple BEV tariffs on three Chinese car makers

Europe to triple BEV tariffs on three Chinese car makers

Business news |
By Nick Flaherty

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The European Commission has provisionally concluded that the battery electric vehicles (BEV) value chain in China benefits from unfair subsidies and is increasing import tariffs on the three leading suppliers.

The Commission is proposing BEV tariffs of 38.1% on SAIC, 20% on Geely and 17.4% on BVD and could apply to vehicles made by Tesla in China and imported to Europe.

This comes as BYD is set to ship its low cost Seagull BEV, and the US imposing 100% tariffs on EV imports from China.

Other BEV producers in China, which cooperated in the investigation but have not been sampled, would be subject to an average duty of 21%. Following a substantiated request, one BEV producer in China – Tesla – may receive an individually calculated duty rate.

All other BEV producers in China which did not cooperate in the investigation would be subject to the following residual duty: 38.1%. 

These are on top of the current 10% tariff on battery electric vehicles form China, putting the overall duties varying from 31% to 48.1%.

“The purpose of the provisional countervailing duties would be to remove the substantial unfair competitive advantage of Chinese battery electric vehicles producers due to the existence of unfair subsidy schemes in China. The duties would therefore aim to ensure that EU and Chinese industries compete on a level playing field. The aim is not to close the EU market to such imports,” said the Commission.

“A successful green transition worldwide will be achieved most effectively and rapidly through fair competition and adherence to global rules. While the EU welcomes imports of goods necessary for the green transition and to achieve the relevant targets, these imports must compete on fair terms with the corresponding EU goods. If these imports are unfairly subsidised, they unduly hurt the EU industry and ultimately undermine the achievement of these goals,” it said.

“The battery electric vehicle sector is crucial for the EU to achieve its green transition ensure that by 2035 all new cars registered in Europe are zero-emission. We must therefore prevent strategic dependencies on foreign partners in this critical sector.  The EU’s green transition cannot be based on unfair imports at the expense of EU industry.”

SAIC is the largest Chinese EV maker, shipping over 5m vehicles in 2023 and ships the MG and Maxus brands into the UK and Europe. Geely owns Volvo and Polestar as well as Lotus, Lynk & Co and Zeekr. BYD has its own brand vehicles.

The Commission says it has reached out to Chinese authorities to discuss these findings and explore possible ways to resolve the issues identified in way compatible with the rules of the World Trade Organisation (WTO)

The duties would be introduced from 4 July and could be backdated for the last three months. Individually, the three companies received detailed information on their own calculations for the BEV tariffs.

The Commission says it will continue to monitor the BEV market, but has not seen any evidence of a recent rapid rise in imports of BEVs from other countries that would trigger an investigation.

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