According to foreign media reports, the European Federation for Transport and Environment stated in a report that although the EU may impose tariffs on Chinese made electric vehicles, this year Chinese made electric vehicles will still account for a quarter of the European electric vehicle market, up from 19.5% in 2023.
The organization cited its analysis that the EU’s increase in tariffs on Chinese made electric vehicles to 25% would indeed make Chinese made mid size sedans and SUVs more expensive than corresponding European models, but compact SUVs and large cars from China will still be slightly cheaper.
The report points out that the prices of lithium-ion batteries produced in China are “at least 20% lower” than those in Europe, and Chinese battery manufacturers have developed more advanced technology and supply chains.
Image source: BYD
The organization also stated that in the long run, raising tariffs will not protect domestic European car manufacturers, as Chinese competitors have already planned to build factories in Europe. The organization predicts that although Tesla, Dacia, and BMW were the main importers of electric vehicles in Europe last year, Chinese brands are expected to occupy 11% of the European electric vehicle market by 2024, and this proportion will climb to 20% by 2027.
The organization suggests that regulating and subsidizing battery production is the only way for EU car manufacturers to compete with Chinese brands by promoting local car manufacturers to expand the production of electric vehicles in the mass market.
“However, due to inadequate regulation and subsidies for battery production, consideration should be given to imposing tariffs on batteries. Compared to the United States and China, the EU currently has the lowest battery tariffs.”
