A BEAUTIFUL BEAT – After investigating for 9 months, the European Commission in the end he decided to impose duties on Chinese electric cars which are imported within the borders of the Union. The investigation has in fact revealed “unfair competition” from Chinese manufacturers, who would have benefited from public subsidies by the Beijing government to allow them to offer their vehicles at prices lower than production costs. Additional taxes effective from July 2024 are calculated based on government subsidies received: for example, for BYD we are talking about 17.4% to be added to the current 10%, for the Geely of a 20% increase and for the Saic (which owns the MG brand) by as much as 38.1%, thus reaching 48.1%. For other Chinese manufacturers, a weighted average duty of 21% will be applied.
REVERSE OF THE MEDAL – Measures that do not reach the peaks of those taken in the United States, where duties have reached 100% of the value (here the news), but which could have greater consequences for the Chinese automotive industry, which sends many more cars to Europe than the USA. But the application of new tariffs that they add up to 10% current will also incidentally affect some Western companies, which produce some of their models in China: for example the BMW group with the iX3 and the Mini, Mercedes with the new Smart models and the Renault group with the compact electric Dacia Spring. And also Tesla, which sends its Model 3s to Europe from Shanghai.
> The MG4 will be one of the models most penalized by the new duties which, for the Saic group brand, go from 10 to 48.1%.
REACTION EXPECTED – Not all European countries have united in support of new duties. Among those most in favor of protecting the European automotive industry were France and Spain, while Germany, Sweden and Hungary opposed the measure, fearful of commercial retaliation from China. Retaliation which could arrive by return post: “China will take all necessary measures to firmly safeguard its rights and legitimate interests,” commented Lin Jian, spokesperson for the Foreign Ministry in Beijing. First of all, there is talk of new duties to be added to the 15% already existing forimport to China, but what would scare the most exposed countries most would be a possible limitation of Chinese exports of crucial technologies, such as batteries. This would lead to major problems in the supply of components, particularly for the European industry, which is very dependent on Chinese components.
