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We’ve known this was coming for months but now it’s here. The EU Commission has put in place new tariffs designed to punish China for heavily subsidizing its EV industry. The path toward these tariffs started last fall when the EU announced an investigation into China’s car industry.
The European Union will begin an investigation into Chinese subsidies of electric vehicles, the bloc’s top official announced Wednesday, in a move that highlights Europe’s growing industrial and geopolitical competition with China.
“Europe is open for competition, not for a race to the bottom,” said Ursula von der Leyen, the president of the European Commission, speaking in Strasbourg, France. “We must defend ourselves against unfair practices.”.
The European Union sees the electric vehicle sector as “a crucial industry for the clean economy, with huge potential for Europe,” Ms. von der Leyen said. “But global markets are now flooded with cheaper Chinese electric cars. And their price is kept artificially low by huge state subsidies.”
The investigation is now complete and yesterday the EU announced the tariffs which range from 17% to as high as 45%. Despite the decision, there was disagreement in the union about whether the tariffs were a good idea.
Just over a year after launching its anti-subsidy probe, the European Commission will set out extra tariffs ranging from 7.8% for Tesla to 35.3% for China’s SAIC, on top of the EU’s standard 10% car import duty.
Germany, the EU’s biggest economy and major car producer, opposed tariffs in a vote earlier this month in which 10 EU members backed them, five voted against and 12 abstained.
