Many of the major European carmakers are not too pleased with EU decision to impose tariff on Chinese EV imports. At the core could be fear of retalia
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One would think European car giants would likely celebrate the imposition of tariff on China-made electric vehicles (EVs) being imported into Europe, right? Wrong. Automotive companies like Mercedes-Benz, BMW and Volkswagen have in fact criticised the recent announcement made by the European Union (EU) to impose tariff on Chinese EV imports.
The European Commission on Wednesday announced imposition of tariff of up to 38.1 per cent on EVs manufactured in China and imported into Europe. Chinese EV companies are accused on benefiting from subsidies provided by the Chinese government which allows brands to offer their EVs in Europe at extremely competitive prices There has been fear that Chinese EVs are flooding several markets in the continent. But while it was predicted that European carmakers would welcome the tariff move, not everyone is warming up to it.
Mercedes-Benz AG was one of the first to react to the decision of imposing tariff on China-made EVs. “As an exporting nation, what we do not need are increasing barriers to trade. We should work on dismantling trade barriers in the spirit of the World Trade Organisation,” CEO Ola Kaellenius said in a statement.
Also Read : Tesla wants EU to reduce tariff on its China-made EVs
BMW CEO Oliver Zipse too has reportedly expressed his displeasure at the decision. “From the BMW Group’s point of view, protectionist measures such as the introduction of import tariffs do not help us to compete on international markets,” he was quoted as saying by Yahoo Finance.
Volkswagen Group has a joint venture in China with SAIC. But even in Europe, the automotive giant has not been too pleased with the EU decision. “Countervailing duties are generally not suitable for strengthening the competitiveness of the European automotive industry in the long term – we reject them,” a spokesperson from the brand told German press agency Deutsche Presse-Agentur.
At the core of the criticism is concern that China could retaliate with higher taxes on foreign-made cars sold here. And this could potentially impact manufacturers who are anyway competing for every inch of space in what is the world’s largest vehicle market.
China goes on the move
Beijing has slammed the EU decision to impose tariff on China-made EVs. As per Reuters, the country has urged EU officials to stop going further on ‘wrong decision.’
While Chinese officials had previously warned a tit-for-tat reaction could be considered if EU does impose tariff on China-made EVs, no such decision has been announced yet. But the possibility is still very real.
First Published Date: 13 Jun 2024, 12:48 PM IST