Electric Vehicles

EU to Vote on Chinese EV Tariffs
Workers conduct safety checks on Imperial brand cars on an assembly line at a Geely automobile manufacturing plant in Linhai, Zhejiang province, in eastern China. © Jenson

EU to Vote on Chinese EV Tariffs

By Simon Johns - Jun 05, 2024

The EU will vote next week on whether to increase tariffs on electric vehicles imported from China, a move that if implemented would cost the Chinese U.S.$4 billion in trade. The Chinese have threatened to retaliate with tariffs on European aviation and agriculture.

China is the world’s largest EV maker and the European Union is the third-largest economy, making the bloc an essential part of Chinese OEMs’ profits, especially as sales are slowing at home and the United States hiked tariffs to 100%. There are also a number of joint ventures between European and Chinese carmakers that could be in jeopardy.

The Chinese were hoping to persuade Spain’s EU parliamentarians to block the vote. Commerce Minister Wang Wentao said while visiting the Chery-Ebro joint venture factory in Barcelona vowed his government would take all necessary measures to defend the legitimate interests of Chinese companies, reported Chinese media.

German automakers are looking to strike deals with Chinese counterparts to gain access to the market and help lower costs on expensive homemade cars. VW and BMW in April pledged more than $5 billion to expand research and production in China. In 2023, almost 29% of cars made by German automakers were sold in China, trade data shows.

Flooding the EU market with cheaper EVs built overseas could be detrimental to the continent’s passenger car motor oil and metalworking fluid producers. EVs do not use engine oil and fewer moving parts means less need for MWFs for achining.

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