Will EU's EV Tariffs Ignite a Global Trade War?
- The EU has approved tariffs of up to 45% on Chinese-made electric vehicles following an anti-subsidy investigation.
- This decision has sparked concerns about a potential trade war between the EU and China, with some member states warning of the economic risks.
- European carmakers with significant operations in China could face retaliation from Beijing, while the global automotive industry braces for the impact of these tariffs.
Bloomberg reports that EU member states have voted to slap tariffs of up to 45% on Chinese-made electric vehicles, ignoring warnings from some members that this dangerous move risks sparking an “economic cold war” with Beijing.
The European Commission, the bloc’s executive arm, recently concluded its anti-subsidy investigation into Chinese imports of battery electric vehicles. The findings supported the Commission’s move to implement the duties, which would last for five years.
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Sources familiar with the voting told Bloomberg that ten member states voted in favor of the duties, while Germany and four others voted against – and 12, including Spain, abstained.
The new duty rate will be as high as 35% for foreign EV manufacturers exporting from China. There is already an existing 10% duty, which means the rate for some foreign EVs imported into the bloc could be as high as 45%. We have provided additional color on the rates here.