Electric vehicles: Chinese car prices set to explode

Electric vehicles: Chinese car prices set to explode
Electric vehicles: Chinese car prices set to explode
The price of Chinese electric vehicles will rise in the coming months. The cause:The European Union has just increased customs duties on certain brands.

Sharp increase in customs duties

The European Union has just announced the introduction of additional customs duties up to 37.6% on imports of Chinese electric vehicles. This decision, taken as a precautionary measure, comes into force immediately, pending a final decision expected in November 2024. Thus, these duties are in addition to the 10% already applied. From now on, the specific rates are as follows: 17.4% for BYD models, 19.9% ​​for Geely and 37.6% for SAIC. Foreign manufacturers producing in China such as Tesla and BMW will face 20.8% duties if they cooperated with the EU investigation. Otherwise, it will be 37.6%, as in the case of SAIC. The decision has also provoked mixed reactions. The Chinese Chamber of Commerce in the EU has denounced it as a protectionist measure. The Secretary General of the Chinese Automobile Manufacturers Federation, Cui Dongshu, has called the decision a mistake.

Electric vehicle prices set to rise in Europe

For their part, European manufacturers such as Volkswagen also fear retaliation from China, a crucial market for them. Thus, the brand fears negative effects on the potential benefits for the European automotive industry, especially for Germany. Indeed, German manufacturers make almost 40% of their global sales in China. In addition, the EU announces discussions with Beijing. Negotiations between Brussels and Beijing are expected to continue intensively for the next four months, with a final decision on definitive customs duties expected in November. According to the German Kiel Institute, these additional duties could reduce imports of electric vehicles from China by 42%, but this reduction could be offset by an increase in sales by European producers and imports from other countries. However, in the long term, this may not make electric cars more affordable in Europe.

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