Wed Oct 09 00:12:31 UTC 2024: ## EU Set to Impose New Tariffs on Chinese EVs Despite Industry Claims of Fair Competition
**Berlin, Germany** – The European Union is poised to finalize new tariffs on Chinese-made electric vehicles (EVs) this Friday, citing unfair state support for the Chinese EV industry. However, Chinese EV companies maintain that their success stems from fierce domestic competition and innovation, not government handouts.
Brian Gu, co-president of Chinese EV startup Xpeng, argues that the industry’s growth is a result of “highly efficient” and “highly innovative” competition among hundreds of startups, leading to a significant reduction in the number of players in the market. He emphasizes the desire for a level playing field and seeks to dispel concerns about undercutting established automakers, pointing out that Xpeng’s cheapest model in Europe is priced similarly to Tesla’s Model Y.
Other Chinese EV executives, like Michael Shu, president of BYD Europe, attribute their success to “management efficiency” rather than government subsidies.
While Xpeng has reported record monthly sales and a significant increase in revenue, it still faces financial challenges with a net loss for the quarter ending June 30. The company is aggressively expanding overseas, selling in about a dozen European markets.
Despite the industry’s claims, the EU is expected to move forward with the tariffs, which could reach up to 35.3% on top of the existing 10% duty on imported cars. Some European governments, like Germany and Spain, have voiced concerns about the tariffs and their potential impact on trade relations with China.
German automakers, including BMW, Volkswagen, and Mercedes-Benz, with significant presence in the Chinese market, have criticized the tariffs, fearing a trade conflict. Notably, Volkswagen is partnering with Xpeng on EV platforms, software, and supply chain management.
However, the EU appears determined to proceed with the new trade protections, fueled by concerns about unfair competition. There are fears that the tariffs could escalate into a trade war, with China already initiating antidumping probes against European brandy and pork in response to EU actions.
German Vice-Chancellor Robert Habeck expresses optimism for a negotiated solution, noting that Beijing has proposed a political resolution. He urges the EU to be open to negotiations, even if it’s “a little bit late.”
Talks between Beijing and Brussels are expected to continue, with both governments having until the end of the month to reach a solution. The upcoming vote on the tariffs will likely add pressure to these negotiations.
First Piper 