The European Union has said it will slap tariffs on Chinese made electric vehicles from next month, the latest strike in an escalating trade war between Europe, the US and China. The bloc has announced tariffs of up to 38.1%. This will come on top of the existing tariff of 10%. The move comes after an investigation by the European Commission into whether the Chinese government was subsiding its EV production.
Europe is walking a fine line in balancing its trade relationship with China. Giant car manufacturing countries like Germany depend on access to the vast Chinese market to sell cars. Volkswagen and BMW are some of the most popular luxury brands in China. But now locally made Chinese cars are catching up, they are high-tech and well-finished. Germany is right to be nervous. Last month the US announced its own tariff regime, a 100% levy on Chinese electric vehicles.