European Union members are holding a crucial vote to impose duties of up to 45% on imports of Chinese electric vehicles (EVs), Reuters reports.
The European Commission proposed final duties for the next five years to counter what it considered unfair Chinese subsidies after a year-long anti-subsidy investigation. However, the proposal could be blocked if a qualified majority of the 15 EU members, representing 65% of the bloc’s population, vote against it.
Germany, the region’s largest economy and biggest car maker, will vote against imposing tariffs, according to expectations. German carmakers, for whom China accounts for nearly a third of sales, have been particularly vocal in their opposition to the tariffs.
Spain’s Economy Minister Carlos Cuerpo also said in a letter to European Commission Vice President Valdis Dombrovskis, the EU should “keep negotiations open… beyond the binding vote” instead of imposing tariffs.
In response, Beijing launched its own inspections of imports of brandy, dairy products and pork from the EU this year. On Friday, Hungarian Prime Minister Viktor Orbán warned that the EU was heading towards an “economic cold war” against China.
The Commission says China’s spare production capacity of three million EVs a year is twice the size of the EU market. Given the 100% tariffs in the US and Canada, the most obvious destination for these EVs is Europe.
The EU executive said it was ready to continue talks with China on an alternative to tariffs and could reconsider price commitments after previously rejecting proposals from Chinese companies.
The tariffs range from 7.8 % for Tesla to 35.3 % for SAIC and other companies deemed not to have co-operated with the EU investigation. Those tariffs are in addition to the EU’s standard 10% import duty on cars.
