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Bloomberg reports that the European Union plans to vote on a 35% tariff on electric cars built in China in addition to the standard 10% import duty.
According to Bloomberg, members received a draft of the regulation for the new measures. If the initiative passes, Chinese electric cars will become less available to European citizens, potentially changing the way they access and use electric vehicles.
The European Commission investigated the impact of China-made electric cars on European industry and found that local manufacturers may be disadvantaged because China subsidizes the market. The report says that Beijing denies any ‘unfair’ activities on its side.
According to the report, some member states, including Germany, are warning against these measures and are calling for a deal with Beijing instead. Bloomberg quotes Robert Habeck, a German Minister for Economic Affairs:
“I am not a fan of countervailing duties because this will likely lead to countermeasures and involve us in a tariff dispute, perhaps a tariff war, with China,” says Robert Habeck, highlighting the potential for a damaging trade conflict.
The alternative to the tariffs is implementing a mechanism to control export volumes and vehicle prices.
The proposed duties will be implemented by the end of October and last five years unless 15 of 27 member states, representing 65% of the EU population, vote to oppose the measures. The vote will take place on Oct. 4.
Negotiations with Beijing may continue even if the EU adopts the tariffs.
