The European Union plans to impose taxes on imports of Chinese electric cars this summer. This measure could increase vehicle prices, and affect their accessibility for European users.
Since last year, the European Union has expressed concerns about competitive advantages builders of chinese electric cars, supported by significant subsidies from Beijing. These concerns culminated with the launch of an official investigation in September 2023. This revealed transfers of funds from the Chinese government to its automakers.
Following these discoveries, the European Commission decided to take action. It plans to introduce temporary customs duties from July 2024. This measure was announced in a document published at the beginning of March.
Tax on Chinese electric cars could come sooner than expected
The introduction of import taxes of Chinese electric cars is a measure that could strongly affect the European automobile market. By increasing the acquisition costs of these vehicles, the measure risks making them less attractive for European users, who until now benefited from very attractive prices.
On the other hand, this approach offers an opportunity to European manufacturers who could see their sales increase if the prices of Chinese competitors align with theirs. There good news is that this could put them at risk challenge to innovate and to offer electric vehicles that are not only competitive in terms of price but also attractive in terms of performance and functionality.
But for our manufacturers, the task will not be easy. The majority of essential components, such as batteriesare currently products in China. This poses logistical and economic problems for European manufacturers who depend on these imports to assemble their vehicles. Europe must therefore accelerate its autonomy in the supply chain of critical components to be able to truly benefit from these price changes.
The new taxes envisaged by the European Union could be applied this summer. In this context, the role of President Emmanuel Macron is central. He is forced to navigate between encouraging Chinese investments in France and adopting protectionist measures which favor European industry. This delicate situation clearly shows the tensions between the need to support local businesses and the need to maintain stable trade relations with China.
