Since last fall, European authorities have been investigating whether Chinese electric vehicle manufacturers are being unfairly advantaged by the Chinese government providing subsidies to make products cheaper. Now the European Commission has found enough grounds to begin introducing increased duties on the import of electric vehicles from China from July.
It is noteworthy, as Bloomberg explains, that even Tesla, which assembles half of its electric vehicles at a plant in Shanghai and exports some of them not only to Europe, but also to the United States, has come under attack. However, the European authorities decided to impose medium-sized duties on the products of this American company of Chinese origin, but individual Chinese automakers will have to face higher duties in Europe, although their names have not yet been specified at this stage.
According to European officials, they found sufficient evidence that Chinese electric vehicle manufacturers have achieved low export prices for their products through direct subsidies from the PRC authorities, tax breaks and “incentives for the sale of goods and services at below-market prices.” Conditional import duties will be introduced in the EU on Chinese electric vehicles from July, and will be fully operational by November. Moreover, the customs authorities of the European Union are already required to keep special records of Chinese electric vehicles imported into the region, so that additional duties can be assessed “retroactively” in the future.
European officials were also alarmed by the fact that since the investigation began, imports of Chinese electric vehicles into the EU have increased by 14% year-on-year, and arguments from Chinese suppliers about the influence of normal market demand on this trend have not worked. Bureaucrats believed that importers were forcing supplies to avoid possible increased duties. From January to November last year, Chinese electric vehicles worth about $12.7 billion were imported into the EU. Even taking into account existing duties and delivery costs, many electric vehicle models from China cost tens of percent less in Europe than their European-made counterparts. The regional authorities consider the introduction of additional duties an important measure to protect local automakers. In addition to Tesla, at least BYD, NIO and SAIC are involved in the supply of Chinese-assembled electric vehicles to the EU.
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