China EV tariff vote leaves EU relieved yet wary over Beijing’s likely retaliation

Decision to slap duties of up to 35 per cent on mainland imports lays bare divisions in European leadership as complex negotiations continue

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Finbarr Berminghamin Brussels

Published: 12:00pm, 5 Oct 2024Updated: 6:15am, 6 Oct 2024

A near-audible sigh of relief emanated from European Commission headquarters on Friday as it gained enough backing from the EU’s 27 members to slap tariffs on Chinese-made electric vehicles.

In the end, the result was not even close: just five of the 15 capitals required to block duties of up to 35.3 per cent on the imports voted against, despite frantic lobbying from Beijing and Berlin to oppose them.

A dozen abstentions might not look like glowing support on paper, but in Brussels they were seen as efforts to offer simultaneous, if lukewarm, support for the commission’s findings, while staying out of Beijing’s retaliatory firing line.

A defeat would have left commission chief Ursula von der Leyen’s hawkish China agenda dead in the water before her second team of commissioners was put in place.

It would also have damaged the bloc’s credibility ahead of a potential return to the White House by Donald Trump after the US presidential election in November.

EV subsidies doubled in China

The EU’s decision to keep countervailing duties on EVs was significant because “it strengthens the new commission and it gives the right signal as to where the EU is in its relations with China – also towards the US prior to its presidential election”, said Alicia Garcia-Herrero of French investment bank Natixis.