EU shocks China with EV duties of up to 38 percent – POLITICO

He added the goal is not to block EVs from China completely: “Our goal is to restore the level playing field and ensure that the European market remains open to electric vehicle producers from China, provided that they play by globally agreed trade rules.”

The EU already charges a tariff of 10 percent on any foreign-made vehicle, versus China’s 15 percent level. The duties announced today will be added on top of the 10 percent tariff.

The EU wants to cancel out the unfair advantage Chinese carmakers enjoy thanks to generous state subsidies, which were the very reason why European Commission President Ursula von der Leyen announced the investigation in her set-piece annual address last September.

Strikingly, Von der Leyen’s own CDU party in Germany immediately criticized the European Commission’s plans. Thorsten Frei, parliamentary secretary of the group in the Bundestag, said: “Germany benefits from free trade more than any other country in the EU.” That is why he is “highly critical of the duties” as they are not “in Germany’s interest.”

But at this level, the question is how much they will affect sales, said Jürgen Matthes, an economist at the Cologne-based economic research institute IW. He added: “The vehicles in China are sometimes only a little more than half as expensive as here because of the price war there.”

Despite the EU telling customs agencies to register imports of all Chinese EVs to allow duties to be collected retroactively from March, this decision will only be made in November. For now, duties will start applying the day after the bloc officially releases the provisional duties on July 4.

This story has been updated.