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EU Transportation China

EU Announces Higher Tariffs of Up To 38% On Chinese EVs (cnbc.com) 84

Posted by BeauHD from the automotive-Cold-War dept.
The European Union on Wednesday said it would impose higher tariffs on Chinese electric vehicle imports, which it found benefit "heavily from unfair subsidies" and pose a "threat of economic injury" to EV producers in Europe. CNBC reports: On a preliminary basis, the European Commission, the executive arm of the EU, concluded that the battery-electric vehicles value chain in China "benefits from unfair subsidization" and pronounced that it is in the EU's interest to impose "provisional countervailing duties" on BEV imports from China. The additional tariffs are the result of an EU probe that began in October. The duties are currently provisional, but will be introduced from July 4 in the event of unfruitful talks with Chinese authorities to reach a resolution, the commission said in a statement. Definitive measures will be placed within four months of the imposition of provisional duties. [...]

The bloc is imposing a 38.1% tariff on battery-electric vehicle producers who did not cooperate with its investigation, and a lower 21% duty on carmakers in the Asian country who complied but have not been "sampled." The commission also disclosed a set of individual tariffs, which [Valdis Dombrovskis, the EU commissioner for trade, said] are linked to their cooperation with the probe and with the amount of information they supplied. Rates are lower for those companies who shared details, he added. Main Chinese BEV producer BYD was struck with a 17.4% tariff, with Geely slapped with a 20% duty. The EU has also imposed its 38.1% tariff on autos firm SAIC. All three producers were sampled in the EU probe, which is ongoing. Meanwhile, taxes on imported Chinese EVs in the United States are set to quadruple from 25% to 100%, starting this year.
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EU Announces Higher Tariffs of Up To 38% On Chinese EVs More

EU Announces Higher Tariffs of Up To 38% On Chinese EVs

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  • EU Commission doesn't listen to EU companies (Score:1, Interesting)

    by Anonymous Coward

    By and large most EU companies is against the tariffs, stating that they could compete, and that it would have detrimental effects on trade. Maybe that's the reason why so many lost in the EU parliamentary elections a few days ago.

    • Maybe that's the reason why so many lost in the EU parliamentary elections a few days ago.

      Ahhh yes because right wing parties are infamous for their lack of protectionism and nationalism. /s Please facepalm yourself for your daft comment.

    • I'm sure they are a bit worried as China's EV revolution is escalating so fast that all China has to do to retaliate is ban ICE vehicle sales and that will kill the big legacy manufacturers

    • Re: (Score:2)

      by Samare ( 2779329 )

      BMW and Mercedes are against the tariffs because they want to sell their cars in China.
      Those two companies don't vote in the elections, and I'm not sure their employees did vote in anticipation of possible tariffs.
      By the way, "so many lost in the EU parliamentary elections" doesn't seem to be valid. The centre-right European People's Party (EPP) of European Commission President Ursula von der Leyen stood its ground.

  • EU has EV producers? (Score:1)

    by Anonymous Coward
    Don't all of the EU automakers outsource their EV production to China already? e.g.: Audi and BMW setup "their own" factories in China with obligatory slices owned by PRC; Jaguar Land Rover uses Chery, as do Stelantis (Maserati, Alfa Romeo, etc.); Volvo uses Geely.

    • Re: (Score:3)

      by _merlin ( 160982 )

      Audi is just a VW brand. Jaguar Land Rover is an Indian company (owned by Tata), not a European company. The Volvo car brand is owned by Geely and hence is Chinese, not European (Volvo trucks, earthmoving equipment, marine diesel motors, etc. are still made by Volvo which is Swedish).

  • No country is going to allow (Score:4, Insightful)

    by rsilvergun ( 571051 ) on Wednesday June 12, 2024 @04:51PM (#64544823)
    China to take over there automobile production because it's the last form of heavy industry that any country hasn't already sent to China and in the event of war those factories get repurposed to make weapons.

    If you dig into it that's why we got stuck bailing out GM when they collapsed. We basically wanted them around so we could seize their manufacturing capacity if we needed it for war.

    • Does "seize" mean "give giant piles of money to"?

      • That entirely depends on the government in charge at the time and whether or not the public has allowed democracy to completely collapse and with it any semblance of capitalism

    • Have car factories actually been repurposed for war since WW2?

      • Re: (Score:2)

        by gweihir ( 88907 )

        Not really. Those old factories were much more flexible in what they could make. That is pretty much over. Maybe when we start 3D printing cars...

      • and there's a reason for that, we haven't had a world war. Doesn't mean we won't. Just that we haven't.

        • Re: (Score:2)

          by nasch ( 598556 )

          But the next world war, if there is one, is very unlikely to resemble the last one much.

    • Re: (Score:2)

      by gweihir ( 88907 )

      China to take over there automobile production because it's the last form of heavy industry that any country hasn't already sent to China and in the event of war those factories get repurposed to make weapons.

      That does not work anymore these days. Factories are too specialized today.

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      Look at steel production. Some European governments don't seem very committed to it *cough*UK*cough*, but it's absolutely essential for both the economy and for war.

  • You can almost smell the WTO form here (Score:5, Interesting)

    by slack_justyb ( 862874 ) on Wednesday June 12, 2024 @05:08PM (#64544861)

    With more and more countries entering into hostile territory with others and protectionism for their own, you'd think the pressure to "do something" within the WTO would be greater than ever. But as the 13th biennial conference of the WTO in Abu Dhabi showed, the WTO is crumbling. Outside of a few token measures that were approved, the only major thing that was agreed upon is that they'd all meet back up for the 14th biennial conference.

    So with the Chinese Trade Representative today saying:

    The EU had ignored that China’s advantage in the EV space is based on open competition and disregarded rules set out by the World Trade Organization

    It's quite clear, the US and the EU are on their way out of the WTO and without them, there isn't a WTO. But at the same time, China had done so many bad faith measures within the WTO, they only have themselves to blame for everyone's disregard for the rules.

    What does a WTO-less future mean? Oh, everything about to get really expensive. Not just simply because of labor in those nations. Companies can make things cheap by volume and the WTO provided Chinese and Indian markets without having to massively bribe US or EU politicians. If there is no WTO, India and China will very likely shut their markets off to outsiders. That's two billion potential customers lost. That's a lot of volume to no longer produce product for. Which means per unit price will absolutely go up for the rest of the consumers.

    Pair with the US and EU's incredibly strong support to ensuring a few massive industries as opposed to a large volume of small industries exist (aka, nobody is enforcing any kind of market manipulation regulation in the US or EU. Hell sometimes they're literally giving tax payer money to bail them out). Those large companies are going to suddenly command a massive amount of power over consumers. I have every inch of faith that they surely won't abuse that new power.

    But yeah. We think inflation is bad now, oh man are we setting ourselves up for a big trap to catch ourselves in.

    And that's not to say we "NEED" China or anything. Just that, we're not doing things in the US or EU to promote healthy economic markets. China does not have a healthy market either, but strangely having two different kinds of shitty models was actually helping a bit, at least for consumers (absolutely not for workers for producers as evident by all the jobs going overseas).

    But anyway, the point is that none of these economies are ready to leave the WTO, but all of them seem dead set to be the first to set it alight. None of this will end well for consumers, but they've been taking in the ass here of late so much that I guess they won't notice the addition of shards of glass to the mix. But hey! They'll have made in their home country cars that no one can afford, so I guess there's that.

    • Populists will just keep demanding isolationism and complaining about inflation and refuse to acknowledge the contradiction. Conservative populists will blame welfare recipients and liberal populists will blame greedy corporations and that explains everything so far as either is concerned.

    • China had done so many bad faith measures within the WTO, they only have themselves to blame for everyone's disregard for the rules.

      The US has also done plenty to undermine the WTO. Just look at the softwood lumber dispute with Canada: the US ignored multiple rulings by both the WTO and NAFTA. Looks like a big just trying bully the smaller neighbour.

  • There's just no reason to favor products of a country that is actively engaged in slavery and genocide, and every reason to disfavor it. China needs to clean up its human rights act before being allowed to play with the free world.

    • But why single out EVs - and solar panels - when there is a climate crisis ?
      If you don't like Chinese labor practices (and I'm not a fan either), do it across the board. These specific tariffs seem like they benefit fossil fuel industries and ICE automakers more than accomplish anything else.

      • My guess is China invested heavily in manufacturing capacity for solar and EVs, so they'll be produced anyways. I bet a lot of countries wouldn't mind looting a bit of China's money, and also wouldn't mind if China went green nowish.

        • Re: (Score:2)

          by madbrain ( 11432 )

          They'll be produced, sure, but they may not reduce carbon emissions. They will likely be used by Chinese citizens who didn't previously drive.
          US carbon emissions will not go down as quickly if EV (and solar) uptake is impeded.
          There are very few solar cells being manufactured in the US. Most "US" panel manufacturer just assemble them from cells manufactured abroad, mostly China.
          This is a really common thing, not exclusive to solar panels. My husband works in manufacturing, on exercise machines. They only do

    • I don't know, if China wants to abuse its own people and the rest of the world gets to do the EV conversion that much sooner... maybe on the balance sheet it's a net good.

      Takes a cold calculating heart to act on that, though.

    • Human rights have nothing to do with buying what you want at a price you're willing to pay.

    • Products like Mobile phone, computers, all electrical components etc? Given yours up yet or do you enjoy being a hypocrite

  • What do the companies that make EVs in the EU think of this? Do they want tariffs on Chinese EVs?

    If the companies who the tariffs are meant to protect don't want the tariffs, there is no reason to have them.

    • Re: (Score:2)

      by _merlin ( 160982 )

      The German car companies are all opposed to it. The way they see it, Germany is an exporter, and any barriers to trade are a bad thing. Various other industries that export to China (e.g. French wine and spirits) are worried China will apply tariffs to a variety of goods in retaliation. A substantial number of French and Italian people seem to approve of the tariffs, though.

  • That does not bode well... (Score:3)

    by gweihir ( 88907 ) on Wednesday June 12, 2024 @08:50PM (#64545259)

    ... for the European car industry. Whenever somebody does protectionism like this, the respective domestic industry is in trouble.

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      European car manufacturers are well behind EV batteries, and most get theirs from China now. The Chinese ones are just unbeatable, on quality, on the range of products available, and on price.

      It's a long and hard road to developing competitive automotive batteries. The Japanese had an early lead but squandered it. Europe has never really produced anything particularly great. Nissan spun-off their battery business and they are producing some okay packs, but nothing exceptional. Korea is about the only place

      • Re: (Score:2)

        by gweihir ( 88907 )

        Sad but true. In particular, Germany did some pretty good research in this space and would have been competitive, IMO. But all the German car makers wanted to optimize short-term profit and stay with fossile fuels. And hence nothing was ever really done to industrialize anything. A pathetically backwards industry that now does not have much of a future. Deservedly.

  • Let them compete (Score:3)

    by bubblyceiling ( 7940768 ) on Thursday June 13, 2024 @02:05AM (#64545659)
    But what about the "economic injury" to consumers, thanks to these duties which will raise the cost of EVs & make competition worse? And the damage to the environment due to slower EV adoption. Which will also be exacerbated further by higher new car costs, leading to people holding onto older cars for longer
  • The EU wants to ban petrol and diesel cars and for people to switch to EVs. Whilst at the same time putting new taxes on EVs to make them more expensive and hence less attractive to consumers. Where is the logic in that?

  • So what I'm reading is that we care more about our GDP then we care about saving the planet. If China can flood the world with EVs, and we all buy them, won't that help, substantially, reduce the amount of greenhouse gases we're dumping into the atmosphere?

    Good to know that company profits are more important then the environment. Regardless of who is in charge, these kinds of decisions seem to keep happening and they always seem to go the same direction.

    • It depends... if China has a very dirty way of making batteries that work "well enough" at a cheap enough price point that they flood the market they could kill economically kill local investment in better battery technology. Though the governments could encourage industry by incentivizing battery tech for grid storage of renewables.

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