New EU Tariffs Threaten Chinese EV Makers Like BYD and NIO

The European Commission will impose tariffs up to 38.1% on Chinese EVs like BYD and NIO, citing unfair subsidies and competitive advantages.

EU Imposes Tariffs Up to 38.1% on Chinese EVs Like BYD and NIO, Citing Unfair Subsidies

According to Electrek, the European Commission will impose additional tariffs of up to 38.1% on EVs imported from China after determining that they have an unjustified advantage due to government subsidies. The new EU tariffs will impact Chinese EV manufacturers, such as BYD and NIO.

In response to increased imports, the European Union initiated an inquiry into Chinese subsidies for electric vehicles (EVs) in October. EU Commission President Ursula von der Leyen stated in her annual address to the European Parliament that the global market is currently inundated with more affordable electric vehicles.

In October, the European Union initiated an inquiry into Chinese subsidies for electric vehicles (EVs) amid increased imports. "Global markets are now flooded with cheaper electric cars," EU Commission President Ursula von der Leyen said in her annual speech to the European Parliament.

"And their price is kept artificially low by huge state subsidies," the leader of the European Commission supplemented. The comments were made in response to the recent introduction of new models by Chinese electric vehicle manufacturers, such as BYD, specifically designed for the region.

According to Jato Dynamics, a prominent global auto data firm, the average retail price of imported Chinese EVs was 29% lower than that of European models (excluding incentives and discounts).

Due to the investigation, the Commission determined that EVs manufactured in China are given a discriminatory subsidy. In a press release on June 11, the Commission stated that the practice is discriminatory, "causing a threat of economic injury to EU and BEV producers."

Consequently, the European Union preemptively disclosed the tariffs it intended to impose on Chinese electric vehicle manufacturers, including BYD.

EU Implements Tariffs on BYD, Geely, and SAIC; China Calls Investigation Protectionism

The Commission contacted Chinese authorities to investigate potential solutions and solicit feedback. In the interim, the European Union implemented tariffs that would apply to three Chinese electric vehicle manufacturers selected for sampling.

The tariffs that would be added would consist of the following:

• BYD: 17.4%
• Geely: 20%
• SAIC: 38.1%

According to the press release, Tesla "may receive an individually calculated duty rate at the definitive stage." Other organizations may request an accelerated assessment.

The EU's findings can be substantiated by the corporations that were sampled. If no resolution is reached by July 4, 2024, the new tariffs will be implemented.

The new tariffs were met with a response from Lin Jian, the Chinese foreign ministry spokesperson. Reuters reported, "This anti-subsidy investigation is a typical case of protectionism." He elaborated that they would only negatively impact the global supply chain and trade relations.

NIO is among the numerous Chinese electric vehicle manufacturers dedicated to expanding their operations in Europe. NIO informed CnEVPost, "In Europe, Nio's commitment to the EV market remains unwavering, and we will continue to serve our users and explore new opportunities within Europe despite protectionism."

The investigation has not yet been completed, so NIO remains "hopeful for a solution." If the 21% weighted average tariff were imposed, NIO would be subject to it, in addition to the current 10% import duties on EVs.

Photo: Microsoft Bing