If a European Union( EU ) anti-subsidy investigation results in punitive new tariffs on their products, China’s electric vehicle ( EV ) manufacturers may need to change supply chains and redirect exports in the upcoming year. & nbsp,
The EU announced on September 13 that a 13-month investigation into whether state subsidies have assisted Chinese EV manufacturers in gaining market share in Europe in recent years may begin. & nbsp,
The declaration followed French President Emmanuel Macron’s May statement that the EU shouldn’t permit China to seize its EV market in the same way that China currently controls 80 % of the global market for solar panel. & nbsp,
In an essay that was released on September 15, columnist Xu Lifan of the Beijing News writes,” After the inspection, the EU does impose more tariffs on imported Foreign EVs.” ” In recent years, the EU has continued to raise taxes in the name of anti-subsidy investigations.” However, it is still unclear whether this will slow the expansion of Chinese EV organizations while boosting those in Europe.
According to Xu, Chinese EV producers and suppliers can adjust their supply chains and trade channels to prevent potential European price increases.
The highest research time for an EU anti-subsidy case is 13 months, according to the Beijing-based Zhong Lun Law Firm, though the republic’s investigators properly complete the research earlier. According to the company, this means that China’s EV manufacturers won’t have much time to improve their provide stores.
According to the law company,” Chinese EV manufacturers will face pressure once the EU concludes its research and imposes anti-subsidy tariffs on them.” Currently, European and American tariffs on Chinese EVs are set at 10 % and 27.5 %, respectively. & nbsp,
According to Reuters, Chinese EV manufacturers BYD, Nio, and Xpeng sold 820, 000 vehicles in Europe in the first seven months of this year, an increase of approximately 55 % from 2022. The market share of Chinese EV manufacturers in Europe has increased from 6 % in 2021 to 13 % this year. & nbsp,
According to the European Commission, if current trends continue, China’s market share for Vehicles sold in Europe could reach 15 % by 2025.
According to French auto consultancy Inovev, Chinese manufacturers’ market share in Europe for fully-EV products was about 4 % in 2021, 6 % to 2022, and 8 % to this point this year. By 2030, it is anticipated that the number will increase by anywhere from 12.5 to 20 %, with annual sales expected to range from 725,000 000 to 1.16 million fully-EVs.
According to a KPMG report, Belgium( 88,000 000 units ), the United Kingdom ( 109, 000 ), and Slovenia( 47,000 units ) were the top three destinations for China’s EVs to Europe in 2022.
Germany and France both endorsed the EU’s decision to launch an anti-subsidy research into China ‘ electric vehicles.
Laurence Boone, the minister for Europe for France, stated on the prosecution’s news,” We won’t let our business be flooded by over-subsidized EVs that threaten our businesses just as it had happened with solar sections.” & nbsp,
German Economy Minister Robert Habeck stated that the EU must act if completely competition rules are found to be broken, adding that” this is about unfair competition, not about keeping efficient, low cars out of the German business.”
The Chinese Commerce Ministry retorted in a statement dated September 14 that it was” a naked work of isolationism that will seriously undermine and alter the global automotive industry network.” ” In China, the EV market has flourished as a result of technology and an extensive business supply chain.”
According to the International Energy Agency( IEA ), new EV sales surpassed 10 million units in 2022 and will reach roughly 14 million by 2023. According to IEA, electric vehicles made up about 14 % of all new vehicles sold globally in 2022, an increase from 9 % to less than 5 % in 2020. & nbsp,
Currently, China is home to about 58 % of all electric vehicles on the road worldwide. According to the China Passenger Cars Association( CPA ), retail sales of EVs in China increased by 36 % year over year to reach 4.44 million units in the first eight months of this year.
However, according to Alicia Garcia-Herero, chief economist for the Asia-Pacific at Natixis, local demand for EVs in China has begun to decline and physical requirement appears to have peaked as well.
The US wants to lessen its reliance on China for the energy transition, which calls for a significant decrease in the imports of electric batteries and EVs, with the passage of the Inflation Reduction Act ( IRA ), according to Garcia-Herero. As evidenced by President Macron’s visit to enforce anti-dumping tasks on Chinese EVs, the EU is under increasing pressure to take action.
According to her, policymakers must implement new business policies and trade agreements, including for crucial raw materials, in order to lessen the EU’s high reliance on Foreign EV batteries and components.
The global expansion objectives that Chinese EV companies have set their sights on are in jeopardy, at least in the West, according to Gracia-Herero. This method may be made more difficult by political conflicts and protectionist measures.
Despite Beijing’s request, Biden continues to impose levies on China.
@ jeffpao3 Follow Jeff Pao on Twitter at & nbsp.