After investigating for 9 months, the European Commission eventually decided to impose duties on Chinese electric cars that are imported within the borders of the Union. The investigation has in fact found an “unfair competition” from the Chinese constructors, that they would have benefitted of public subsidies from the government of Beijing in order to allow them to offer own vehicles to inferior prices regarding the production costs. The additional taxes in force since July 2024 are calculated on the basis of government subsidies received: for example, for BYD it is said that 17.4% will be added to the current 10%, for Geely a 20% increase and for Saic (which holds the MG brand) even 38.1%, This brings it to 48.1%. For the other Chinese houses a weighted average duty of 21% will be applied.
Measures that do not touch the peaks of those taken in the United States, where duties have come to weigh for 100% of the value, but that could have greater consequences for the Chinese car industry, which in Europe sends many more cars than the USA. But the application of new rates that add to the current 10% will accidentally hit some Western companies, which produce some of their models in China: for example the BMW group with the iX3 and the Mini, Mercedes with the new Smart models and the Renault group with the compact electric Dacia Spring. And also Tesla, which sends its Model 3 from Shanghai to Europe.
Not all European countries have joined forces in support of the new tariffs. France and Spain were among the most favourable to protecting the European car industry, while Germany, Sweden and Hungary, fearful of commercial retaliation by China, sided against the measure. “China will take all necessary measures to firmly safeguard its legitimate rights and interests,” said Lin Jian, spokesman for the Beijing Foreign Ministry. First of all, there is talk of new duties to be added to the 15% already existing for imports to China, but what would scare the most exposed countries would be a possible limitation of Chinese exports of crucial technologies, such as batteries. This would lead to major problems in the procurement of components, especially for European industry, which is highly dependent on Chinese components.