The European Union has taken a significant step towards implementing new tariffs on Chinese electric cars. Automakers have been instructed to secure guarantees from banks to ensure they can meet the taxes, which are expected to be finalized in October.
On June 12, the EU announced that additional tariffs ranging from 17 to 38 percent would be imposed on electric vehicles imported from China. This decision followed an investigation revealing what Brussels officials deemed as unfair subsidies provided by the Chinese government to electric car manufacturers. Despite China’s denial of subsidizing the industry, the EU maintains its stance.
Dialogue between the EU and China commenced on June 22 in an effort to find a resolution to the dispute. Valdis Dombrovskis, the EU trade commissioner, expressed the ongoing commitment to finding a mutually acceptable solution.
Under the provisional tariffs, automakers must furnish European countries with financial assurances for future payments, without an immediate monetary transfer requirement. Tariff rates differ based on the extent of government subsidies received by each Chinese manufacturer. The highest tariff of 37.6 percent is applied to SAIC Motor, while lower rates of 17.4 percent and 19.9 percent are imposed on BYD and Geely, respectively.
