BERLIN (dpa-AFX) – The introduction of punitive tariffs on Chinese electric cars is expected to have negative consequences for car dealers and car buyers. For consumers, intervention in competition with Chinese manufacturers risks raising the price of electric cars, Thomas Peckruhn, vice-president of the German automobile industry federation (ZdK), told the Augsburger Allgemeine newspaper. This would only aggravate the already reserved buying trend.
For car dealers who have decided to welcome a Chinese brand and have invested to do so, penalty fees would distort competition, Peckruhn said. Additionally, the likelihood of a Chinese response is high. This would affect all exports of vehicles not produced in China and lead to a weakening of manufacturers and suppliers based in Germany. “Punitive customs duties are not a solution for fair global trade,” underlined the vice-president of the association.
The way is clear for EU customs duties
Despite opposition from Germany, the EU was able to impose additional customs duties on electric cars from China. No sufficient majority of EU countries have spoken out against this project, European diplomats confirmed on Friday. The European Commission can therefore decide at any time to introduce taxes of up to 35.3 percent. German car manufacturers have reacted with concern and continue to hope that the negotiations will fail. For its part, the Chinese government wishes to maintain negotiations.
It is not yet clear whether and to what extent customs duties would be passed on to customers. If manufacturers don’t pass on the costs, they will have to pay the surcharge out of their own pocket. According to calculations made at the end of May by the Kiel Institute for the World Economy (IfW), customs duties would lead to higher purchase prices for electric cars, because car imports from China would decline.
Electric car sales are already low
Due to low demand for electric cars, the industry has further reduced its forecasts for 2024. The German automobile industry association (VDA) announced that it now only expects annual sales of 372,000 battery cars, or 29% less than the previous year. Until now, the trade association expected a drop of 25% to 393,000 new electric cars.
According to the data, only 276,000 pure battery vehicles were sold in Germany in the first nine months, 29% less than last year in the same period. According to the VDA, the main reason is the abandonment of requirements for electric cars last year. Electric cars thus represented 13% of all new registrations.
Baden-Württemberg Transport Minister Winfried Hermann (Greens) criticized the fact that manufacturers in Europe had not developed enough small, affordable electric models. However, customs duties would now make cheaper electric cars from China more expensive, which would slow down the transition to electromobility. “This goes against the EU’s own climate goals and is therefore climate-damaging and economically fatal.”
VW boss: there is still time not to negotiate
The president of the VW group, Oliver Blume, fears a reaction from Beijing which would impose customs duties on German cars exported or built in China. According to him, it is important that the German government continues to take a clear position against customs duties in the EU. “We have until the end of October for these to come into force. My hope is that Brussels will still come to an understanding with the Chinese side and reach a solution that is fair for both parties,” Blume said.
Rather than tariffs, it should be about considering investments in a positive way for both parties. “Those who invest, create jobs and work with local companies should benefit from tariff benefits. We would then expect the same in the regions where we produce and invest,” the leader said. Asked whether Chinese manufacturers should have their electric cars produced in Germany, Mr Blume replied: “Yes, that would be one approach. This would not only apply to companies in China, but also to those from other regions that invest in Europe and thus have a positive impact on the economy.”/hgo/DP/ngu
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