EU's additional tariffs on China-produced electric vehicles provoke criticism
On Friday, the European Union voted to impose tariffs of up to 45 percent on imports of battery electric vehicles manufactured in China. This decision has sparked substantial resistance from several EU member states as well as the automotive industry.
TroibNews 
The European Union voted on Friday to impose tariffs of up to 45 percent on imports of battery electric vehicles manufactured in China, sparking considerable opposition from multiple EU member states and the automotive sector.
In response, the China Council for the Promotion of International Trade expressed its firm opposition on Saturday, urging that China and the EU should settle their differences through dialogue to achieve a solution serving both sides' interests.
China's Ministry of Commerce also voiced strong opposition to the EU's decision on Friday, deeming it "unfair, non-compliant and unreasonable." However, it acknowledged the EU's political willingness to engage in continued negotiations.
Technical teams from China and the EU are set to resume discussions on October 7.
A divided bloc
The European Commission indicated that the proposal had garnered the necessary backing from EU member states for its adoption. The vote highlighted a divided bloc: 10 members supported the tariffs, 12 abstained, and five – notably including Germany, the EU's largest economy and a major automotive producer – opposed them.
Germany's Finance Minister Christian Lindner remarked on social media platform X on Friday, "Despite the vote for potential punitive tariffs against China, Ursula von der Leyen's EU Commission should not trigger a trade war. We need a negotiated solution." He had previously asserted that tariffs on Chinese EVs "would be wrong," emphasizing the need for straightforward communication with China and cautioning that "trade wars only have losers."
Hungarian Prime Minister Viktor Orban mirrored these sentiments, stating in an interview with state radio on Friday, "What they are making us do right now, or what the EU wants to do, is an economic Cold War."
Prior to the vote, Hungarian Foreign Minister Peter Szijjarto expressed on Thursday that Hungary is "strongly against" the proposal, describing it as "so harmful and dangerous" and characterizing the Brussels bureaucrats as jeopardizing the European economy's future competitiveness.
Finland, which abstained from the vote, believed there was insufficient evidence to show damage caused to the EU by the alleged Chinese state support for the EV industry, according to Xinhua.
Industry backlash
The automotive industry responded vehemently against the announcement, deeming it a mistake and calling for further negotiations.
Hildegard Mueller, president of the German Association of the Automotive Industry, stated in a Friday announcement that Germany's opposition is the "right signal" from the government, advocating for the interests of the European and German automotive sectors and their workers with regard to the economy, prosperity, and growth. She argued that the EU's decision represents "a further step away from global cooperation" and underscored the need for negotiations between the EU and China, urging that they "must prevent an escalation – ideally avert the tariffs so that we don't risk a trade conflict."
German automaker Mercedes-Benz described the tariffs as "a mistake that can lead to far-reaching negative consequences." CEO Ola Kallenius said at the Berlin Global Dialogue on Wednesday that direct tariffs are "a very crude instrument" and advocated for more refined solutions that wouldn’t impede access to key markets.
Volkswagen criticized the tariffs as "the wrong approach" and called for the two parties to "constructively continue" negotiations. BMW CEO Oliver Zipse labeled the vote as "a fatal signal" for the European auto industry and urged a swift resolution between the European Commission and China to "prevent a trade conflict from which no one gains."
Geely Holding, which owns Sweden's Volvo, expressed "great disappointment" over the decision, arguing that it could negatively impact EU-China economic and trade relations and ultimately harm European companies and consumer interests.
Consumer implications
The ramifications extend beyond the automotive sector to consumers.
A study from the Kiel Institute for the World Economy, released in May, indicated that imposing tariffs on Chinese-made EVs would significantly raise prices for consumers in Europe. The institute projected that a 20 percent tariff could result in a 25 percent decline in imports of Chinese EVs. "Converted to the almost 500,000 vehicles imported in 2023, this corresponds to an estimated 125,000 units worth almost $4 billion," the simulations stated.
The institute further noted that the anticipated decline would largely be offset by increased production within the EU and a reduced volume of EV exports, likely leading to noticeably higher prices for end consumers. Mueller emphasized that the suggested tariffs "would not only further increase the risk of a mutual trade conflict but would also make vehicles considerably more expensive for consumers,” adding that the potential damage from countervailing duties outweighs the prospective benefits of such measures.
Anna Muller for TROIB News
In response, the China Council for the Promotion of International Trade expressed its firm opposition on Saturday, urging that China and the EU should settle their differences through dialogue to achieve a solution serving both sides' interests.
China's Ministry of Commerce also voiced strong opposition to the EU's decision on Friday, deeming it "unfair, non-compliant and unreasonable." However, it acknowledged the EU's political willingness to engage in continued negotiations.
Technical teams from China and the EU are set to resume discussions on October 7.
A divided bloc
The European Commission indicated that the proposal had garnered the necessary backing from EU member states for its adoption. The vote highlighted a divided bloc: 10 members supported the tariffs, 12 abstained, and five – notably including Germany, the EU's largest economy and a major automotive producer – opposed them.
Germany's Finance Minister Christian Lindner remarked on social media platform X on Friday, "Despite the vote for potential punitive tariffs against China, Ursula von der Leyen's EU Commission should not trigger a trade war. We need a negotiated solution." He had previously asserted that tariffs on Chinese EVs "would be wrong," emphasizing the need for straightforward communication with China and cautioning that "trade wars only have losers."
Hungarian Prime Minister Viktor Orban mirrored these sentiments, stating in an interview with state radio on Friday, "What they are making us do right now, or what the EU wants to do, is an economic Cold War."
Prior to the vote, Hungarian Foreign Minister Peter Szijjarto expressed on Thursday that Hungary is "strongly against" the proposal, describing it as "so harmful and dangerous" and characterizing the Brussels bureaucrats as jeopardizing the European economy's future competitiveness.
Finland, which abstained from the vote, believed there was insufficient evidence to show damage caused to the EU by the alleged Chinese state support for the EV industry, according to Xinhua.
Industry backlash
The automotive industry responded vehemently against the announcement, deeming it a mistake and calling for further negotiations.
Hildegard Mueller, president of the German Association of the Automotive Industry, stated in a Friday announcement that Germany's opposition is the "right signal" from the government, advocating for the interests of the European and German automotive sectors and their workers with regard to the economy, prosperity, and growth. She argued that the EU's decision represents "a further step away from global cooperation" and underscored the need for negotiations between the EU and China, urging that they "must prevent an escalation – ideally avert the tariffs so that we don't risk a trade conflict."
German automaker Mercedes-Benz described the tariffs as "a mistake that can lead to far-reaching negative consequences." CEO Ola Kallenius said at the Berlin Global Dialogue on Wednesday that direct tariffs are "a very crude instrument" and advocated for more refined solutions that wouldn’t impede access to key markets.
Volkswagen criticized the tariffs as "the wrong approach" and called for the two parties to "constructively continue" negotiations. BMW CEO Oliver Zipse labeled the vote as "a fatal signal" for the European auto industry and urged a swift resolution between the European Commission and China to "prevent a trade conflict from which no one gains."
Geely Holding, which owns Sweden's Volvo, expressed "great disappointment" over the decision, arguing that it could negatively impact EU-China economic and trade relations and ultimately harm European companies and consumer interests.
Consumer implications
The ramifications extend beyond the automotive sector to consumers.
A study from the Kiel Institute for the World Economy, released in May, indicated that imposing tariffs on Chinese-made EVs would significantly raise prices for consumers in Europe. The institute projected that a 20 percent tariff could result in a 25 percent decline in imports of Chinese EVs. "Converted to the almost 500,000 vehicles imported in 2023, this corresponds to an estimated 125,000 units worth almost $4 billion," the simulations stated.
The institute further noted that the anticipated decline would largely be offset by increased production within the EU and a reduced volume of EV exports, likely leading to noticeably higher prices for end consumers. Mueller emphasized that the suggested tariffs "would not only further increase the risk of a mutual trade conflict but would also make vehicles considerably more expensive for consumers,” adding that the potential damage from countervailing duties outweighs the prospective benefits of such measures.
Anna Muller for TROIB News
