Europe gives China a taste of its own trade medicine – POLITICO
The big idea is to use the tariff threat to force Chinese carmakers to come to Europe to form joint ventures and share technology with their EU counterparts, according to conversations with four diplomats and two senior officials.
There are signs the formula is already attractive with EU carmakers. Franco-American-Italian carmaker Stellantis has formed a joint venture with China’s Leapmotor to start Europe operations in September. Spain’s EBRO-EV has teamed up with Chery — China’s fifth-largest automotive company — to develop EVs in Barcelona.
Many, however, will detect a supreme irony in this switch in tactics from the Europeans. For years, the EU has been at the vanguard of western investors howling in protest at Beijing’s demands that foreign investors in China should form joint ventures and share know-how: It’s what the EU used to slam as forced technology transfer.
The world has now changed. The fear is no longer that the Chinese will steal European EV technology in a game of catch-up, but rather that Europe is falling behind. Realizing that its industry needs fresh investment and expertise to compete, the EU is now turning its eyes toward a negotiated solution with Beijing.
European industry insiders say carmakers are keen for such deals, which they argue make the most business sense for a sector that has fallen behind.
“Joint ventures make sense, as a way to make sure that the Chinese don’t only set up final assembly plants in Europe, but also more substantial parts of the supply chain. Of course, it can also be a way to ask the Chinese to share some technology,” said one senior diplomat, who was granted anonymity to discuss the sensitive matter.
