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EU to Impose Tariffs of Up to 38% on Chinese Electric Vehicles — Update

By David Sachs

 

The European Commission plans to impose new tariffs on Chinese electric vehicles after a probe provisionally found that state subsidies unfairly hurt EU manufacturers.

Chinese EV makers BYD, Geely, and SAIC will be subject to new tariffs of 17.4%, 20%, and 38.1%, respectively, the EU's executive branch said. Other carmakers that cooperated with the investigation will have to pay a new duty of 21%, while those that didn't will be subject to the tariff rate of 38.1%.

"The provisional findings of the EU anti-subsidy investigation indicate that the entire BEV value chain benefits heavily from unfair subsidies in China, and that the influx of subsidized Chinese imports at artificially low prices therefore presents a threat of clearly foreseeable and imminent injury to EU industry," the Commission said.

The EU said it disclosed the tariff amounts to affected companies and contacted Chinese authorities to discuss the findings and potential resolutions.

European carmakers including Volkswagen, BMW, Mercedes-Benz, and Stellantis face pricing and market-share pressure in China from homegrown manufacturers like BYD and Geely, which also have growth plans in Europe.

Retaliatory measures from Beijing could dent German carmakers that generate the bulk of their profit from premium brands like Mercedes, BMW, Audi and Porsche, RBC analyst Tom Narayan said in a note. However, much of their sales are cars made in China for local consumers, which could mitigate damage, Narayan added.

The EU's decision follows new tariffs of 100% imposed by the U.S. on Chinese EV imports.

 

Write to David Sachs at david.sachs@wsj.com

 

(END) Dow Jones Newswires

June 12, 2024 07:09 ET (11:09 GMT)

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