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Today the EU faces a crucial vote that will decide how tariffs will definitively affect Chinese electric cars sold in our market. Although in July The provisional amounts have already been established, The European Commission proposed raising them to 45%, a measure that was intended to protect our industry and that could achieve the opposite.
Before the possible retaliation announced by Chinathe Minister of Economy, Carlos Body, has asked the EU to avoid a trade war: “Instead of imposing tariffs, the EU should keep negotiations open, beyond the binding vote to reach an agreement on prices,” said in a letter seen by Reuters.
“There is a lot at stake for our national industry”
In the letter sent by Corps to the vice president of the European Commission, Valdis Dombrovskis, the Spanish Minister of Economy also establishes that to reduce tension “the European Union should seek a compromise and a negotiated solution with China”, as well as work to “relocate the production of batteries in the block,” according to Reuters.
“There is a lot at stake for our national industry“, added Body, pointing out that Spain is the second largest automobile producer in the EU. “We have to find the right balance, technically and politically, to ensure both the defense of our industrial interests and avoid large-scale confrontation with strategic actors like China.”
Along the same lines, the President of the Government, Pedro Sánchez, has already he said last month during a visit to China that the EU should reconsider your position on tariffsand urged Brussels and Beijing to avoid a trade war. “I think we have to build bridges between the European Union and China, and from Spain we will be constructive and try to find a compromise between China and the European Commission,” said Sánchez.
Among other things, this call to reduce tension on the part of Spain is due to the fact that when Europe announced new tariffs on Chinese electric carsto which Spain voted positively, China responded with a pork antidumping investigation that Europe exports to that country. This notice worried all of Europe, but especially Spain, since it is the country that exports the most pork to China in the world: almost 21% of the total.
The final tariffs proposed by the European Commission They would add 10% to those imposed on each manufacturer in Julybeing among the highest for SAIC and Geely and the lowest for Tesla or BYD. In the case of brands that consider that they cooperated in the EU investigation, such as Leapmotor or Xpeng, in addition to subsidiaries of BMW or Volkswagen that manufacture in China and import from there, they would go from 20.7% to 30.7%. .
The Commission’s proposal can be implemented unless a qualified majority of 15 EU members, representing 65% of the EU population, votes against it. In principle today France, Greece, Italy and Poland will vote in favor, according to sources consulted by Reuters. This translates to 39% of the EU population, enough to pass the most far-reaching EU trade measures.
On the contrary, Germany would be planning to vote against: Both the German union IG Metall and workers’ representatives from the country’s main car manufacturers, led by Volkswagen, said in a joint statementthat “tariffs are the wrong approach because they will not improve the competitiveness of the European car industry.”
And German manufacturers have a lot to lose. Not only because they have factories in China where they produce models for the local market, but because of the cars they export to China from Europe and which generate significant profits for brands such as Mercedes or Porsche.
In fact, one of the possible retaliations that the Chinese Government could activate is impose 25% tariffs on large-displacement gasoline cars. Currently, all cars imported from Europe to the Asian country carry 15%.
Volkswagen and Renault are some of the brands that already produce electric vehicles in Spain, while the Chinese Chery Auto has already signed a joint venture agreement with the Spanish EV Motors to produce cars in its first factory in Europe. At the moment, Chery has already announced that will manufacture 300,000 cars a year in the old Nissan plant in Barcelona, while BYD will build factories in Hungary and Türkiye.
But the final decision could change things. The Commission claims that the tariffs “are necessary to counteract cheap loans, land and raw materials, as well as other subsidies,” and that the goal is “a level playing field, not the exclusion of Chinese automakers,” as is likely They will make the 100% tariffs planned by the United States.
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