Will the EU Tariffs on Chinese Electric Vehicles Also Hit EU Firms?

On 12 June, the European Commission announced the first provisional decision under its anti-subsidy inquiry for battery electric vehicles (BEVs) assembled in China. Albeit initially driven by Western foreign direct investment, Chinese car producers have become prominent producers of battery electric vehicles.

This note asks if the imposition of import tariffs may also affect EU producers and reflects the discussion against a trade context. A 2023 analysis reveals that 55% of BEVs sold in the EU and manufactured in China are produced by EU carmakers through joint ventures, a decline from 68% in 2022. Consequently, these companies will be directly affected by the tariffs. However, the suppliers to these OEMs are predominantly located in China (85%). This indicates that EU suppliers are considerably less affected than Chinese firms. 


Our annual Advisory Board meeting took place last week, where we were able to discuss welcome input for the future direction of ASCII. Society at large is at an inflection point: Not only do we have wars on our doorstep, but we also have to meet the challenges of the green transition. As a result, the export-led economic growth model of recent years is increasingly unraveling.
The European Union is imposing provisional countervailing duties of 21% on battery electric vehicles (BEVs) imported from China from July 4, 2024. This move follows an investigation that found evidence of WTO-inconsistent subsidies for Chinese BEVs. Imports of Chinese vehicles could fall significantly, but prices for electric cars are unlikely to change much in the long term.
On September 16, ASCII is launching a new format to make the exciting world of supply chain research accessible to interested parties outside of science and politics: the ASCII Nachtcafé. This is a series of events in which current topics can be discussed informally over snacks and drinks.