EU wants to tax electric cars from China, including Teslas, for five years

These customs duties should apply by the end of October, subject to the approval of the 27, who are divided on the subject.

The European Union (EU) is considering imposing five-year tariffs on imports of Chinese electric cars, including Tesla at a reduced rate. However, nothing is definitive. Brussels remains open to an alternative solution from Beijing, the European Commission announced on Tuesday, August 20.

Brussels will add to the 10% tax already in place a surcharge of up to 36% on imports of Chinese electric vehicles. The American manufacturer Tesla, which has its own factories in China, has obtained a rate of up to 36%. “individual” of 9%, significantly lower due to the lower level of subsidies received by the brand created by Elon Musk, Brussels specified. These customs duties will apply by the end of October for five years, subject to the approval of the 27, divided on the subject. They will then replace provisional taxes decided at the beginning of July, and going up to 38%, the Commission specified in a press release.

While France and Spain actively pushed for proportionate measures, Germany, which is very involved in China, fought with Sweden and Hungary to avoid sanctions, fearing reprisals from Beijing. Berlin is particularly reluctant, because of the weight of its automobile industry in China. Manufacturers Audi, BMW, Mercedes and Volkswagen achieve nearly 40% of their global sales in China.

The Chinese Chamber of Commerce in the EU warned of the consequences on Tuesday. “negative” on relations between Beijing and Brussels, criticizing a “protectionism” disguised. “The Chamber of Commerce expresses its deep dissatisfaction and firm opposition to the protectionist approach of the European Commission”she assured in a press release, also warning of the danger of“exacerbation of trade tensions between the EU and China”.

The European car industry, which employs 14.6 million people and is the champion of petrol and diesel engines, fears that its factories will disappear if it fails to stem the predicted flood of Chinese electric models. Beijing has taken the lead with a long-standing investment in batteries. In the EU, the market is booming ahead of the 2035 ban on sales of new combustion engine vehicles: Chinese electric vehicles represent 22% of the European market, compared to 3% three years ago, according to industry estimates.