By D. Maan, Jadetimes News
Beijing has requested the European Union to reassess the imposition of tariffs on Chinese electric vehicles, cautioning against more actions that could negatively impact the automotive industry. China's response, as reported by the state news agency Xinhua, underscores the opposition from several parties, including European and Chinese automakers and industry associations, who are eager to reduce tensions.
The European Commission has recently declared the imposition of supplementary tariffs, ranging up to 38.1%, on Chinese electric vehicles (EVs) that are imported into the European Union. This move has the potential to result in billions of euros in additional expenses for auto manufacturers, as per the EU trade data for the year 2023.
Xinhua highlighted the necessity for China and the EU to cooperate on important economic and trade matters, taking into account their respective economic structures and sizes. The opinion proposed that the European Union should capitalise on China's advantages in order to foster the growth of its own electric vehicle (EV) sector, instead of imposing substantial tariffs. The European Union's decision follows closely after the United States announced intentions to raise tariffs on Chinese electric vehicles to 100%. The EU's new tariffs, designed to combat Chinese subsidies, have the potential to increase the highest overall rate to almost 50%, in addition to the existing 10% auto duty.
Although certain Chinese electric vehicle (EV) manufacturers are making investments in European production to avoid tariffs, the response from Chinese EV producers' shares to this news was varied. However, BYD's shares listed in Hong Kong experienced a significant surge of over 7%. Consequently, the stocks of prominent European auto manufacturers, who significantly depend on the Chinese market, declined as a result of concerns about potential reprisals from Beijing.
European automakers including BMW, Volkswagen, Stellantis, and Mercedes Benz do not endorse the tariffs, despite the increase in affordable electric vehicles (EVs) from Chinese rivals. The European Commission emphasised the necessity of taking action against Chinese electric vehicles (EVs) that are receiving subsidies in order to safeguard the EU market. However, Xinhua, a Chinese news agency, advocated for a strategic and long term perspective, encouraging the EU to reassess its approach and prevent exacerbating the issue.