The newest casualty of the EU–China trade war: the green transition
26 August 2024
A long-standing trade dispute between the EU and China continues to hurt the EU’s green transition. Since 5 July, Chinese-made electric vehicles (EVs) have been subject to high EU import tariffs. This makes EVs less affordable for European consumers: take the Chinese brand BYD, whose EV models cost €5,250 more since the new tariffs were imposed.
Adding fuel to the fire, the EU announced last week that Tesla cars would not be subject to the same tariffs as other EVs produced in China. This will keep the price of Tesla's relatively low for European consumers compared with that of Chinese EV brands.
 | Luc de Klerk The EU imposes tariffs on Chinese EVs because Chinese state subsidies drive down the price for consumers and constitute "unfair competition" according to the European Commission. Some Chinese EV manufacturers are subject to tariffs as high as 36.3%, while Teslas produced in China will only attract tariffs of 9%. For context: after the United States imposed tariffs on Chinese EVs, their price doubled for consumers. In Europe, the number of Chinese EV's imported into the EU went down significantly; registrations for Chinese-made EVs dropped by 45% this year alone. The trade war on a path to escalate further after China filed a complaint about the EU tariffs to the World Trade Organisation. Its biggest victim, however, is the EU's green transition; just as the number of registered Chinese EVs went down, the overall share of EVs in the EU fell compared with last year. Fewer affordable electric vehicles won't make it easier for the EU to reach net-zero by 2050. |
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