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Released October 15, 2024 | GALWAY, IRELAND
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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Europe is to press ahead with significant tariffs on Chinese-made electric vehicles (EVs) after a divided vote among European Union (EU) nations.
The vote was highly contentious among European nations, with heavy hitter Germany voting against the tariff in an effort to appease its major car manufacturing industry, which has a strong Chinese export market. Ten EU Member States voted in favor of the tariffs with five voting against and 12 abstentions. It would have taken 15 EU Member states voting against the proposal to block the tariffs. The European Commission (EC) was tightlipped about the voting outcome, merely stating that it had received "the necessary support" to adopt the tariffs, but that talks with Beijing are ongoing to find an alternative solution. Chinese EVs are already facing 100% import taxes in the U.S and Canada.
The decision comes following a year-long investigation by the EC into Chinese EV makers benefitting from substantial subsidies from the Chinese government. The tariffs will range from 17% to 36% depending on the carmaker and their level of cooperation with the investigation, and will be added to the existing 10% tax already in place. The proposed charges against carmakers including BYD (Xi'An, China), Geely (Hangzhou, China) and SAIC Motor Group Company Ltd (Shanghai, China) among others, will cost them billions of euros in extra charges to bring cars into the bloc. They will, unless a solution can be agreed, be imposed from next month for five years. Some of the biggest carmakers affected are currently looking at building car plants in Europe to avoid the tax.
"Today's vote is a fatal signal for the European automotive industry," claimed BMW chief executive officer, Oliver Zipse. "What is needed now is a quick settlement between the EU Commission and China to prevent a trade conflict from which no one gains. The fact that Germany voted against the tariffs is an important signal and increases the chances for a negotiated settlement." Fellow German carmaker Volkswagen AG (VW) (Wolfsburg, Germany) also called on Germany's government to vote against the tariffs stating: "The proposed tariffs are the wrong approach." China accounts for almost a third of all car sales for Mercedes-Benz (Stuttgart, Germany), BMW and Volkswagen.
Europe has seen a huge surge in cheaper, Chinese EVs in the last couple of years, many sold at much lower prices than their European equivalents. Industrial Info is tracking a US$1 billion plan by BYD (Shenzhen, China) to build a manufacturing plant in Turkey that will produce up to 150,000 vehicles per year. It has already committed to building a plant in Szeged, Hungary. Chery Automobile Company Limited (Wuhu, China) purchased a former Barcelona manufacturing plant earlier this year, which it is revamping with a Spanish EV partner to become one of its main exporting facilities worldwide, with the goal of producing 150,000 vehicles a year by 2029.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
The vote was highly contentious among European nations, with heavy hitter Germany voting against the tariff in an effort to appease its major car manufacturing industry, which has a strong Chinese export market. Ten EU Member States voted in favor of the tariffs with five voting against and 12 abstentions. It would have taken 15 EU Member states voting against the proposal to block the tariffs. The European Commission (EC) was tightlipped about the voting outcome, merely stating that it had received "the necessary support" to adopt the tariffs, but that talks with Beijing are ongoing to find an alternative solution. Chinese EVs are already facing 100% import taxes in the U.S and Canada.
The decision comes following a year-long investigation by the EC into Chinese EV makers benefitting from substantial subsidies from the Chinese government. The tariffs will range from 17% to 36% depending on the carmaker and their level of cooperation with the investigation, and will be added to the existing 10% tax already in place. The proposed charges against carmakers including BYD (Xi'An, China), Geely (Hangzhou, China) and SAIC Motor Group Company Ltd (Shanghai, China) among others, will cost them billions of euros in extra charges to bring cars into the bloc. They will, unless a solution can be agreed, be imposed from next month for five years. Some of the biggest carmakers affected are currently looking at building car plants in Europe to avoid the tax.
"Today's vote is a fatal signal for the European automotive industry," claimed BMW chief executive officer, Oliver Zipse. "What is needed now is a quick settlement between the EU Commission and China to prevent a trade conflict from which no one gains. The fact that Germany voted against the tariffs is an important signal and increases the chances for a negotiated settlement." Fellow German carmaker Volkswagen AG (VW) (Wolfsburg, Germany) also called on Germany's government to vote against the tariffs stating: "The proposed tariffs are the wrong approach." China accounts for almost a third of all car sales for Mercedes-Benz (Stuttgart, Germany), BMW and Volkswagen.
Europe has seen a huge surge in cheaper, Chinese EVs in the last couple of years, many sold at much lower prices than their European equivalents. Industrial Info is tracking a US$1 billion plan by BYD (Shenzhen, China) to build a manufacturing plant in Turkey that will produce up to 150,000 vehicles per year. It has already committed to building a plant in Szeged, Hungary. Chery Automobile Company Limited (Wuhu, China) purchased a former Barcelona manufacturing plant earlier this year, which it is revamping with a Spanish EV partner to become one of its main exporting facilities worldwide, with the goal of producing 150,000 vehicles a year by 2029.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
