European Commission President Ursula von der Leyen has declared the European Union"must defend ourselves" from unfair subsidies to Chinese electric vehicle makers.
The probe will include both Chinese manufacturers, such as BYD and Xpeng, and companies from overseas which build cars in China, such as Tesla. In July, Renault announced it would attempt to slash production costs for its EVs by 40 per cent in an effort to bring prices down to match those of Chinese brands.
Ms von der Leyen said the investigation, which could take up to 13 months to complete, was aimed at ensuring the bloc's emerging EV industry did not suffer the same fate as its solar sector. Picture: Getty Images "Europe is open for competition. Not for a race to the bottom. We must defend ourselves against unfair practices."
Ms von der Leyen's announcement is likely to further heighten tensions between China and the EU, with observers suggesting the investigation will now dominate discussions at an important economic and trade dialogue scheduled for September 25.