EU Imposes Temporary Tariffs on Chinese EVs, Leaving Four Months for Talks to Resolve Issue

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New cars lined up for exports in Suzhou, Jiangsu province, on July 2, 2024

The European Union is to impose provisional tariffs on electric vehicles (EVs) imported from China, from Friday, leaving a four-month window for both sides to negotiate a solution before the temporary duties become final in November.

The temporary anti-subsidy duties on three Chinese manufacturers were announced by the European Commission on Thursday after an investigation found their supply chains benefitted from state subsidies, which posed a threat to EU carmakers.

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The European Union will impose provisional tariffs on Chinese electric vehicles starting Friday due to state subsidies benefiting Chinese manufacturers.
Specific tariffs are set for SAIC Motor Corp. (37.6%), Geely (19.9%), and BYD (17.4%), adding to an existing 10% rate; other cooperating firms face a 20.8% average, while non-cooperators will face 37.6%.
Negotiations will continue, aiming for a resolution by November, with Tesla seeking an individual rate, and Germany's VDA urging the EU to reconsider the tariffs.

AI generated, for reference only

Who’s Who

SAIC Motor Corp. Ltd.: SAIC Motor Corp. Ltd., a state-owned automaker from China, will face a 37.6% tariff on electric vehicles exported to the European Union. This is part of the provisional anti-subsidy duties announced by the European Commission. SAIC was cited in the Commission's report for failing to cooperate in the investigation, which found its supply chain benefitted from state subsidies.

Geely: Geely, the parent company of Volvo Car AB, will face a provisional tariff of 19.9% on electric vehicles imported into the European Union starting Friday. This tariff is part of the EU’s response to state subsidies benefiting Chinese manufacturers, deemed a threat to EU carmakers. The tariffs may be confirmed by a vote of EU governments before Nov. 2.

BYD Co. Ltd.: BYD Co. Ltd., one of the three Chinese EV manufacturers affected by the EU's provisional tariffs, will face an added charge of 17.4%, on top of the existing 10% rate. These tariffs come after the European Commission's investigation into state subsidies benefiting Chinese supply chains. The tariffs are provisional until a final decision is made in November.

Volvo Car AB: Volvo Car AB, owned by China's Geely, will face a 19.9% provisional anti-subsidy tariff on electric vehicles imported into the European Union from Friday. This is part of the EU's measures against Chinese manufacturers benefiting from state subsidies. The tariff is in addition to the existing 10% rate, making the total duties as high as nearly 30%.

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What Happened When

June 22, 2024：: EU trade chief Valdis Dombrovskis held video talks with Wang Wentao, China's Minister of Commerce, intensifying discussions about the tariffs.

Wednesday July 3, 2024：: Germany’s auto association VDA urged the European Commission to drop planned tariffs, citing the significance of German car sales in China versus Chinese car sales in Germany.

Thursday July 4, 2024：: European Commission announced temporary anti-subsidy duties on three Chinese manufacturers after an investigation found their supply chains benefitted from state subsidies.

Thursday July 4, 2024：: China's Ministry of Commerce spokesman He Yadong stated at a news conference that China and the EU will expedite consultations over the tariff issue.

Friday July 5, 2024：: EU to impose provisional tariffs on EVs imported from China, with a four-month window for negotiation before the tariffs become final in November 2024.

Friday July 5, 2024：: State-owned automaker SAIC Motor Corp. Ltd. to face a 37.6% tariff, Volvo Car AB parent Geely 19.9%, and BYD Co. Ltd. 17.4%, in addition to the existing 10% tariff.