China: tariffs on electric vehicles will begin in October – Commerzbank

The European Union (EU) voted last Friday to impose an additional 35% on imports of Chinese electric vehicles (EV).

The Chinese market remains closed today

“It adds to the existing 10% levy, bringing the total to 45%. It will be effective at the end of this month and will last five years. This follows a year-long investigation by the European Commission into the EV market. It concluded that “Chinese EV manufacturers received heavy state subsidies, including their suppliers.”

“Chinese automakers in the European market face a difficult decision, whether to absorb the tariffs, which will reduce profit margins, or raise prices and risk a decline in demand. Some producers are considering moving production to Europe to avoid tariffs China has already threatened to impose tariffs on imports of European brandy, dairy products, pork and automobiles. However, both sides have expressed their willingness to continue negotiations for an alternative solution that adequately addresses concerns over tariffs. China’s huge state subsidies.”

“10 member states reportedly voted in favor of the additional tariffs, including France, Italy and Poland. 5 members, including Germany, Hungary, Slovakia, Slovenia and Malta, voted against. China is an important export market for Germany and Hungary, which had pushed for a more moderate response. The remaining 12 members abstained. The Chinese market remains closed today and will reopen tomorrow.”