The EU has decided that the quadruple duty must be applied to all electric cars that are built in China and brought here. The rules go into effect this week.
The EU has decided to impose a significantly higher punitive tariff on electric cars produced in China, with tariffs that can reach up to 45.3 percent when imported into EU countries. The decision on increased customs duties on what are also called "Chinese cars" was adopted by the EU Commission on Tuesday.
This is written by the Reuters news agency.
Previously, the customs duty on Chinese electric cars in the EU was ten percent. However, after a thorough investigation of Chinese state aid earlier in October, the EU countries decided to add up to 35.3 percent extra duty. This change has now been formally approved, according to a senior EU official speaking to Reuters.
Duty rates vary depending on the car brand. For example, Tesla is subject to an additional duty of 7.8 percent, while the SAIC group, which i.a. owns MG, faces an increase of as much as 35.3 percent. So on top of the 10 percent the brand already pays.
The purpose of these changes is to create more equal conditions for European car manufacturers, who, according to the EU Commission, are under pressure from the Chinese manufacturers' pricing.
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The investigation into Chinese state subsidies, which the EU Commission carried out in the spring, concluded that China provides unreasonable state subsidies to its own car manufacturers. The EU believes that this state aid leads to market distortion and can harm the competitiveness of European car manufacturers, which is why the extra duty is now being implemented.
This approach is not unique to the EU; The United States and Canada have previously imposed similar tariffs against Chinese automakers. However, Germany, which is the EU's largest economy and leading car manufacturer, has expressed concern about the increased tariffs.
German Chancellor Olaf Scholz has pointed out that such a policy could lead to retaliatory tariffs from China against German car products, which could create new trade conflicts.
The Chinese government has reacted sharply, calling the EU's policy "protectionist" and harmful to diplomatic relations between the EU and China.
According to the EU Commission, Chinese electric car manufacturers currently have around eight percent of the electric car market in the EU, which is an increase from less than one percent in 2019. The prices of Chinese-produced electric cars are generally around 20 percent lower than their European competitors.
The new tariffs are expected to come into effect later this week, either Wednesday or Thursday, and will henceforth regulate the import of Chinese electric cars to the EU market.
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