European Union Officially Endorses Tariffs On Chinese EVs

The European Union has been mulling higher tariffs on imported Chinese EVs for months now, announcing those intentions back in June. At that time, however, the EU noted that it would be meeting with Chinese officials and automakers in an effort to find alternative avenues to resolve issues pertaining to unfair business practices and national security concerns. Now, a few months later, the European Union has announced that it’s officially endorsing increased tariffs on Chinese EVs.

The European Commission’s proposal to impose definitive countervailing duties on imports of all-electric from China has obtained the necessary support from EU Member States for the adoption of tariffs. This represents another step towards the conclusion of the Commission’s anti-subsidy investigation after the EU and China have been working to explore an alternative solution that would address what the EU calls “injurious subsidization.” Regardless, this investigation is still ongoing, though the European Union has set a target date of October 30^th, 2024 in terms of coming to a definitive conclusion.

If the EU does move forward by imposing tariffs on Chinese EVs and raw materials, it would follow both the U.S. and Canada, which have already done so. Higher U.S. tariffs on Chinese EVs and other materials kicked in just last month, in fact. Unlike those two countries, however, select Chinese models are already on sale in Europe – including the BYD Seagull, which Ford CEO Jim Farley has singled out as a big threat to the automakers business, given its ultra-low price tag.

BYD is in the midst of a rapid global expansion and recently upped its sales goal for 2024 to the point where it could come close to moving as many vehicles as Ford by the end of the year. In the meantime, Ford has been working on developing a low-cost EV platform of its own to better compete with Chinese EVs for the past couple of years, which is slated to underpin a variety of future models.