Trade war

Cars, EU proposes minimum prices on electric cars to China to cancel tariffs

The aggressive attitude of the United States, politically and economically, is causing a readjustment in international relations

Operai sulla linea di produzione dei SUV Aito presso la Super Factory del Gruppo Seres Co. a Chongqing, Cina. (Fotografo: Qilai Shen/Bloomberg)

2' min read

Translated by AI
Versione italiana

2' min read

Translated by AI
Versione italiana

FROM OUR CORRESPONDENT

BRUSSELS - In an international context marked by an ever-sharper rift in transatlantic relations, the European Union has presented guidelines that - if respected - would allow Chinese manufacturers to import electric cars into Europe without being subject to the tariffs decided in 2024. Among the criteria for a European green light are promises of investment. The announcement opens the door to an escalation of tensions with China, at least in this sector.

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The October 2024 decision

Faced with the massive arrival of Chinese cars on the European market, the European Commission had decided a year and a half ago to impose additional tariffs of up to 35% on Chinese vehicles, accusing the manufacturers of enjoying public subsidies. On that occasion, it had proposed allowing companies to avoid the new tariffs (to be added to the 10% already provided for) in return for a formal commitment to sell at certain prices.

An initial proposal to this effect reached Brussels last month, explained EU spokesman Olof Gill (the initiative 'is still under consideration'). In an attempt to facilitate relations between Beijing and Brussels, the European Commission therefore published guidelines to facilitate the submission of formal price proposals by Chinese car manufacturers. The eight-page document was welcomed by the Chinese government.

Concretely, the guidelines presented by Brussels specify that the price proposed by the carmaker "must eliminate the harmful effects of subsidies" enjoyed by production in China; and that the price commitment must relate to individual models. Among other things, the Commission warns that it will be cautious when assessing the risks of cross-subsidisation between different models of the same car company.

"Any commitment to invest in battery electric vehicle-related industries within the European Union will be taken into account and evaluated within the price commitment. Commitments should be clearly defined in terms of nature, scope, timeframe and financial scale. Furthermore, clear and verifiable targets should be set'. A breach of the investment commitment would result in the withdrawal of the sales authorisation and the recovery of tariffs.

Beijing's reaction

From Beijing, the Ministry of Commerce spoke of 'progress', which 'fully reflects the spirit of dialogue and the results of the consultations between China and the European Union'. It added: 'Both have the ability and willingness to properly resolve differences. This helps not only to ensure the healthy development of economic and trade relations, but also to safeguard the rules-based international order'.

The US's aggressive political and economic stance is causing a readjustment in international relations. It should be noted that the tariffs adopted in 2024 affect Chinese companies - BYD Group, Geely Group and SAIC Group - but also foreign manufacturers in China such as Tesla or Volkswagen. According to the latest figures, BYD increased its European sales of cars, both electric and non-electric, by 240% annually between January and November last year (with its market share rising from 0.3 to 1.1%).

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