EU member states approve tariffs of up to 45% on Chinese EVs

The European Commission's proposal to impose tariffs of up to 45% on Chinese battery electric vehicles has secured the necessary support during a vote by EU member states on Oct. 4.

In a statement released shortly after the vote, the EC said that the result represents a step toward the conclusion of its anti-subsidy investigation.

The proposed tariff duty rates, which will be implemented on top of an existing 10% tariff, were listed at the rate of 17% for BYD Group, 18.8% for Geely Group, 35.3% for SAIC Group, 20.7% for other cooperating companies and 35.3% for all other non-cooperating companies.

The EC has proposed an individual duty rate for Tesla as an exporter from China, established at 7.8%, after Tesla requested an individual examination to determine its duty level based on the specific subsidies it received.

The commission also decided not to retroactively collect countervailing duties, as its investigation had indicated that the legal requirements for the retroactive collection of duties were not fulfilled.

The EC must now publish a Commission Implementing Regulation that includes the definitive findings of the probe in its Official Journal by Oct. 30.

The EC also said it was continuing to engage with China to explore an alternative monitorable and enforceable solution that addressed the findings and is compatible with World Trade Organization rules and regulations.

The EU formally launched Oct. 4 its anti-subsidy investigation to determine whether Chinese battery electric vehicle producers benefited from “illegal subsidization” in response to independently obtained evidence.

The initiation of the investigation followed repeated warnings from the European automotive industry about the negative impact of Chinese brands and Chinese-made vehicles on the European EV market.

In a statement published shortly after the vote, China’s Chamber of Commerce expressed its “deep disappointment” with the outcome and urged the EU to consider the consequences of imposing new duties on Chinese BEVs.

“The chamber reiterates that the EU’s anti-subsidy investigation into Chinese electric vehicles is a politically motivated and unjustified protectionist measure,” it said.

“Such tariffs will not strengthen the resilience of local industries in Europe or other markets; instead they risk deterring Chinese investments, undermining the competitiveness of the European market, and diminishing the vitality of the global EV supply chain."

The Chinese Chamber of Commerce to the EU added that Chinese negotiation teams continued to engage with the EU to identify viable alternatives to the implementation of tariffs.

Platts, part of S&P Global Commodity Insights, assessed battery-grade lithium carbonate at Yuan 75,500/mt ($10,710/mt) on a DDP China basis Oct. 4, down 86% from the start of 2024.

Battery-grade lithium hydroxide was assessed at Yuan 72,500/mt DDP China on Oct. 4, down 87% since the start of the year.