FILE - Jerry Gan, CEO of Geely Auto Group unveils the Galaxy Starship a new technology flagship AI-driven SUV prototype during Auto China 2024 in Beijing, Thursday, April 25, 2024. The European Union threatened on Wednesday, june 12, 2024, to hike tariffs on Chinese electric vehicles, escalating a trade dispute over Beijing's subsidies for the exports that Brussels worries is hurting domestic automakers. imported from China.
The higher duties are not a goal in themselves but “a means to correct an imbalance,” commission spokesman Eric Mamer said Thursday. “We certainly hope we can come to a solution which would allow us not to have to move forward on this path.” The rapid growth in market share has sparked fears that Chinese cars will eventually threaten the EU's ability to produce its own green technology needed to combat climate change, as well as the jobs of 2.5 million workers at risk in the auto industry and 10.3 million more people whose jobs depend indirectly on EV production.
European countries subsidize electric cars, too. The question in trade disputes is whether subsidies are fair and available to all carmakers or distort the market in favor of one side. Currently, Chinese carmakers often sell their vehicles in Europe at much higher prices than the same cars fetch in China, meaning they are favoring profits over market share, even given their recent market gains. Five of BYD’s six models would still earn a profit in Europe even at a 30% tariff, according to Rhodium Group calculations.
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