Starting from next month, the European Union will impose additional tariffs on electric vehicles from China at a rate of 38.1%, leading to an escalation of the global trade war and increased sales costs for companies from Chinese BYD Co. to Tesla Inc.
Source: Bloomberg
The EU officially notified carmakers, including BYD Co., Geely Automotive Holdings Ltd., and SAIC Motor Corp Ltd., about tariffs that are set to be imposed around 4 July. Chinese electric vehicle manufacturers are increasingly pushing into Europe amid internal price wars and years of leadership in this technology.
Individual tariffs on BYD vehicles will be 17.4%, Geely 20%, and SAIC 38.1%, the commission said on Wednesday. China has hinted at retaliatory action, threatening measures on agriculture, aviation, and large-engine automobiles. Beijing has already initiated investigations into some types of European alcohol, with results expected soon.
Background:
The European Commission plans to announce temporary tariffs on Chinese electric vehicle manufacturers that could reach around 25%. Plans by Chinese carmakers to invest in Europe will not be halted by the EU’s anti-subsidy investigation into Chinese-origin electric vehicles.
Volvo, headquartered in Sweden and majority-owned by Chinese carmaker Geely, is considering plans to relocate some car production from China to Belgium.
China is prepared to impose tariffs of up to 25% on imported automobiles from EU and US carmakers amidst escalating trade tensions.
US President Joe Biden is increasing tariff rates on imports of Chinese goods, including semiconductors, batteries, solar panels, and electric vehicles.
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