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European Union
OpinionComment
Azhar Azam
Azhar Azam

The View | EU must see that tariffs aimed at China-made EVs will hit Europe too

  • If tariffs are imposed at the end of the anti-subsidy investigation, they would apply to all cars made in China – including those by European brands
  • Higher duties will also raise prices for Europe’s car buyers, impede the bloc’s efforts to decarbonise and deal a blow to China-EU relations

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A visitor tests the touchscreen controls of a Renault Rafale electric vehicle at the Munich Motor Show in Germany, on September 5. Raising tariffs is not the way to make Europe’s EV producers more competitive. Photo: Bloomberg
Azhar Azam
Ursula von der Leyen’s announcement that the EU is to launch an anti-subsidy investigation into China-made electric vehicles (EVs), in her last annual State of the Union address as European Commission president, will have wide implications for the European Union economy, consumers and climate change goals.
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Seen as a pitch for her reappointment, however, the probe rebuts her own assertion that the EV industry is crucial for the clean economy. This is because, if import tariffs are imposed as a result of the investigation, they would target not just Chinese brands but all China-made cars, including non-Chinese brands such as Tesla, BMW, Mercedes-Benz, Volkswagen, Polestar, Renault and Volvo.

This would also strip European buyers of the right to have access to cheap and consumer-friendly EVs.

China has emerged as a global hub for legacy carmakers due to its enormous manufacturing capacity, backed by consistent government support, innovative engineering and battery technology, the result of a generation of arduous efforts.
Last year, China sold about 6.9 million new energy vehicles and installed 2.6 billion charging points, contributing 35 per cent to global EV exports, according to the International Energy Agency. China’s market share of EV sales in Europe is, however, just 8 per cent, the EU said, and could reach 15 per cent by 2025.
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European EV manufacturers fret that China’s formidable transformation into the world’s leading EV production and innovation hub – with its carmakers and battery producers even seeking to set up shop in Europe – could drive them out of the market. But whatever their concerns, they only have themselves to blame for lagging behind China.
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