EU Imposes Provisional Countervailing Duties on Chinese Electric Vehicle Imports

EU Imposes Provisional Countervailing Duties on Chinese Electric Vehicle Imports

The European Commission has imposed provisional countervailing duties on imports of electric vehicles (EVs) from China. The decision comes as a response to alleged subsidies provided by the Chinese government, which are seen as giving Chinese manufacturers an unfair advantage in the European market.

The duties range from 19.7% to 79.3%, depending on the level of subsidy each company receives. This measure is part of the Commission's ongoing investigation, which began in May 2023, into the impact of Chinese subsidies on the competitiveness of European EV manufacturers.

The provisional measures are intended to protect the European market from what the Commission considers to be unfair trade practices. Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, stated, "We must ensure a level playing field for our industries. The subsidies from the Chinese government are distorting the market and threatening the viability of the European electric vehicle sector."

The investigation has revealed significant price undercutting by Chinese EVs, with some models being sold at up to 20% lower than their European counterparts. This has raised concerns among European manufacturers about the sustainability of their operations and the potential loss of market share.

The duties will remain in place for four months while the investigation continues. A final decision on whether to make these duties permanent will be made by the end of 2024. The Commission's action underscores its commitment to defending European industries from unfair competition and ensuring fair trade practices.

This move is likely to escalate trade tensions between the EU and China, as China is a major player in the global EV market. The Chinese Ministry of Commerce has already expressed strong opposition to the EU's decision, describing it as "protectionist" and "unjustified."

Source: European Comission