Countries in the EU are divided about imposing additional tariffs on EVs manufactured in China. Germany, whose automakers saw 33% of their sales generated from China last year, opposes the tariffs, while France strongly supports them. Many countries in the EU are still undecided, according to an informal poll conducted by Reuters.
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Details About the EU Tariffs
The additional tariffs are set to kick in from Thursday. Currently, the EU imposes tariffs of 10% on Chinese EVs, and these new tariffs will be in addition to the existing import duties. The EU will impose tariffs of 17.4% for BYD (OTC:BYDDY), 20% for Geely (OTC:GELYF), and 38.1% for SAIC Motor Corp. Other Chinese EV makers like NIO (NYSE:NIO) will attract a weighted average import duty of 21%.
The Commission noted that all other Chinese manufacturers who did not cooperate with the EU’s investigation would be subject to a tariff of 38.1%. Additionally, the Commission noted that Tesla (NASDAQ:TSLA), which manufactures EVs in China, “may receive an individually calculated duty rate at the definitive stage.”
Stance of Other EU Countries Over Tariffs
According to the report, this issue about tariffs will be put to an advisory vote for EU members over the coming weeks. EU members may also vote again in October if the Commission proposes tariffs over multiple years at the end of its investigation. The EU undertook this investigation last year to determine whether Chinese EV manufacturers benefit from import subsidies in the European Union.
Interestingly, France, Italy, and Spain, which consist of 40% of the population in the EU, have indicated that they are in favor of the tariffs.
German Automakers Urge the EU to Drop the Tariffs
Meanwhile, Germany’s association of automakers has urged the European Commission to drop its planned tariffs. The association stated that the tariffs would adversely affect European and U.S. automakers exporting from China and could result in retaliation by China. There is a possibility that China could retaliate by imposing additional tariffs on EU exports of pork, cognac, or luxury cars.
Is DRIV ETF a Good Buy?
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