Posted on 04/17/2025 9:00:15 PM PDT by Miami Rebel
Tariffs of up to 45 per cent on Chinese-made electric cars imported into the European Union may be replaced with a new ‘minimum pricing’ system after previously stalled discussions between the two trading partners were re-started.
A ‘minimum pricing’ arrangement – also referred to as ‘price floors’ or ‘price undertakings’ – between the European Union (EU) and China would see tariffs abolished and set minimum prices agreed upon.
According to Reuters, European trade commissioner Maros Sefcovic has said any new policy would have to be as effective as tariffs, given the approach has previously only been applied on ‘homogenous commodities’.
The tariffs – which only apply to battery-electric vehicles and not Chinese-made hybrids or other cars – have not stopped the growth of Chinese brands in Europe, with sales increasing 64 per cent (across all models, not only electric) in February 2025 alone.
Some of the cheapest electric cars on sale in the EU, even from European brands, are made in China and include the Citroen e-C3 and the Dacia Spring, neither of which are currently offered in Australia.
Yet sales of Chinese-made electric cars did fall 3.4 percent in February, however, while European battery-electric vehicles sales increased 26 per cent.
The return of the EU and China to the negotiating table last week was motivated by the need to respond to extraordinary tariffs between the United States (US) and China on all goods – including electric cars.
While some concessions from the US have allegedly been made – such as on electronics, although this is not confirmed – the rapidly changing trade battle has not seen tariffs on vehicles reduced at the time of writing.
The idea of minimum pricing was already being discussed as an alternative when the EU tariffs came into effect on October 31, 2024.
The European Union (EU) Commission and Chinese officials discussed ‘price commitments’ to replace tariffs, according to Reuters reports at the time, with both looking for a mutually agreeable solution compatible with World Trade Organisation (WTO) rules.
The tariffs came after an EU investigation declared the Chinese auto industry a significant threat to Europe’s car-making business, with state-support from the Chinese government enabling an ‘unfair advantage’.
Each Chinese car manufacturer was asked to submit details on its level of government support, which would determine the tariff rate for each brand. Those who co-operated – and had less government support – like Tesla were given the lowest tariff, with the electric car maker given a 7.5 per cent rate.
The maximum tariff was dished out to car makers who failed to cooperate when asked for details, such as SAIC Motor – the parent company of MG and LDV brands – which was given a 38.3 per cent tariff on top of the standard blanket 10 per cent.
Geely – owner of Volvo, Polestar, Lotus and half-owner of Smart in partnership with Mercedes-Benz – was given a 20 per cent tariff, while
Tesla rival BYD saw 17.4 per cent applied to its electric vehicles.
Not all 27 member states voted in favour of the tariffs, with notable objections from Germany where Volkswagen faced closure of factories in its homeland for the first time in its history.
Around one-third of Germany’s annual auto exports – totalling 3.4 million last year – are sent to China, although its brands suffered dramatic falls in sales in late 2024.
BYD is currently constructing a factory in Szeged, Hungary – which last month saw the EU launch an investigation into alleged ‘unfair Chinese government subsidies”, according to Reuters.
Hungary also voted against the tariffs with BYD’s investment announced in December 2023.
Those in favour included France – where the Renault-Nissan-Mitsubishi Alliance is headquartered – and Italy, home of Stellantis group which includes Fiat, Ferrari, Alfa Romeo, Jeep, Ram Trucks, Chrysler, Peugeot, Alpine and former General Motors brand and sister-company to Australia’s Holden, Opel.
BYD, the biggest maker (there are over 100 manufacturers in the country!), has an SUV, the Titanium, that is more advanced technologically than almost any competitor, and it sells for less than $20,000 US. Additionally, it's launching a megawatt charging system that can fully charge a car in FIVE minutes. At the high end, there are models like the NIO ET9 (check out the Car and Driver review) that run over $100,000 and stack up favorably against Rolls Royce and Mercedes-Maybach.
As it is, the only Chinese manufactured cars in the US are the gas Volvo and the hybrid Polestar, neither particularly impressive. Other Chinese brands will probably never be available here, but I don't doubt that they will be successful in almost any market where they're allowed.
So instead of tariffs, it government sanctioned non-competitive agreements, with the purpose of giving a middle finger to Trump. Very lefty pettiness.
If the Chinese make such a superior product so cheaply then they are fools to have tariffs, government subsidies and import restrictive regulations that result in countries that they want as markets to retaliate in kind. Somehow doubt those products can be made in China without huge subsidies from the Chinese government. Yet as Milton Friedman wrote if someone wants to sell highly subsidized products at a very cheap price, accept them while you can and benefit because eventually the subsidies will result in big losses and will end.
how many have you driven and how many times?
which ones? thanks ahead of time for the info
NO ONE would judge cars based on what they’ve READ, I’m sure.
So you must have driven them quite a bit
Maybe it’s just me but I find it hard to trust the NTers like Rebel.
Point 2: Some AU news outfits are too close to China for my liking. The liberals are short on credibility on any issue dealing with Trump.
Milton Friedman was an amazing man, but he likely did not anticipate that we'd be 'trading' with an enemy Communist nation that would use targeted subsidizations and intellectual property stealing as weapons to destroy foreign industries - while simultaneously putting profits from their trade surplus into rapid expansion and modernization of their military.
That does look like a nice car...
It sounds like the Chinese car companies get a price increase (pure profit) while the governments get nothing and EV prices are artificially inflated…. Good plan Europe!
Chinese propaganda.
I can imagine broken down EV’s dotting EU highways and similar image of snow covered roads where EV’s do not well. Go EU.
China and the EU...new best friends.Color me stunned!
I have driven and been driven around in a number of BYD models ,including the BMW 5 series clone. All of them electric or full hybrids. Those cars are every bit as well built, fast and solid as the BMW they nearly bolt for bolt cloned. Shanghai is full.of BYDs more than half of all new cars sold in Shanghai are full EV. There are L2 charge points everywhere. Every parking lot has rows and rows of GBT standard poles around the edges. Same for condo blocks and apartments. Shanghai has very low single.family homes it’s all huge condo blocks and apartments.if the high rise.building kinds. They utterly and thoroughly smash the myth you cannot put enough charge points in condo or apartment settings it flat out is a lie to say you cannot the Chinese prove in spades the exact opposite is true. They are petrol poor and electricity rich they put 400V triple phase to everything including condo units as single phase of that ground to neutral is standard 240V 50hz. It is America with its 19th century archaic 120/240 split phase that is literally a century behind in infrastructure. The Europeans also do 3phase 400V to everything using a single phase of that for.regular 249V loads but you always have the other two.phase to make a 400V 3p load perfect for L2 or even 100kw HVDC L3 single post chargers you see those in China attached to walls they cost $10,000 new and service 24 cars a day at one per hour. I have seen private condos in China with 4-6 of those stations in the garage wall for tenants and then a rack of L2 in the other end of the parking deck. China is killing it infrastructure, their subways,metros and high-speed rail make the USA look like a broken down last.century crumbling empire.
Fifty cent army?
Thank you for sharing your first-hand experiences. Someone else above stated since I haven’t driven one, I have no standing to speak on them based solely on viewing dozens of videos from reputable car enthusiasts.
It is easy to disparage the genuine accomplishments of the Chinese, based on their history of I.P. theft and on our current political and economic tension. This does not somehow make them in the right, but it does point to the West’s inertia in applying new technologies. I just heard a podcast which covered the fact that China is currently blanketed with “dark factories,” so called because they are 100% automated and hence need lights on only when humans are required to clean and maintain the machines.
“make the USA look like a broken down last.century crumbling empire.”
One of the big reasons Trump ran for POTUS...hated seeing our crumbling infrastructure - not to mention everything else that is wrong.
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