[Author: Ni Jianhao]
The growth of the Chinese EV industry alarmed many lawmakers and politicians in the EU, which on Friday (04/10/2024) voted on the imposition of tariffs on imported electric vehicles from China.
The vote was expected to pass, even as German opposition, led by Olaf Scholz, did its utmost to oppose the bill. Germany voted against the proposal, taking a more committed position than the one assumed in July, when Germany abstained instead. German industrial groups, comprehending nearly every automaker, and labor unions like IG Metall had pressured the government to not allow further tariffs on Chinese automakers, warning that Beijing was expected to retaliate with broader measures or probes on European goods.
“We said unequivocally: tariffs were the wrong approach because they would not improve the competitiveness of the European automotive industry,” both the German automakers and labor unions stated in a joint statement.
Spain also expressed the desire to see Brussels negotiate and reach a compromise with China regarding this matter during its visit last month to China, pointing out that a trade war should have been avoided. Hungary was also expected to vote against the bill as the country was searching for more support and investment outside the European Union.
The push to protect the EU’s market share on new energy vehicles was supported instead by countries far less exposed than Germany to the Chinese market, like France, Italy, and Poland, which were expected to put their weight behind supporting the bill. The imposition of tariffs constituted a first achievement by the current EU commission led by Ursula Von Der Leyen, which was reelected on a mandate of “de-risking” trade relations with China.
However, the impact of an eventual isolationist policy regarding green energy goods from China was uncertain for the European transition to a net-zero economy. As things stood, the lack of competitiveness of European green energy products, including solar panels and electric cars, in comparison to their Chinese counterparts risked leaving the EU out of the transforming global energy market and delaying the bloc’s green energy transition.
[1] Germany to vote against EU tariffs on Chinese electric vehicles. (2024, October). Reuters. https://www.reuters.com/business/autos-transportation/germany-vote-against-eu-tariffs-chinese-electric-vehicles-sources-say-2024-10-03/
[2] Reuters. (2024, October 3). German union, auto workers call on Germany to vote against EU tariffs on Chinese EVs. Reuters. https://www.reuters.com/business/autos-transportation/german-union-auto-workers-call-germany-vote-against-eu-tariffs-chinese-evs-2024-10-03/
[3] Liboreiro, J. (2024, September 11). Sánchez urges the EU to “reconsider” tariffs on Chinese electric cars, exposing cracks. Euronews. https://www.euronews.com/my-europe/2024/09/11/sanchez-urges-the-eu-to-reconsider-tariffs-on-chinese-electric-cars-exposing-cracks
[4] Reuters. (2024b, October 3). Hungary will veto EU plan to impose Chinese EV tariffs -foreign minister. Reuters. https://www.reuters.com/business/autos-transportation/hungary-will-veto-eu-plan-impose-chinese-ev-tariffs-foreign-minister-2024-10-03/[5] France. (2024, October 4). EU states set to greenlight extra tariffs on EVs from China. France 24. https://www.france24.com/en/live-news/20241004-eu-states-set-to-greenlight-extra-tariffs-on-evs-from-china
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