EU threatens tariff hike of up to 38% on Chinese electric vehicles

The new import duties will apply from July 4 “should discussions with Chinese authorities not lead to an effective solution”, it said.

The European Union will hike tariffs on Chinese electric vehicles (EVs) on July 4, unless Beijing fail to agree a “solution” to subsidies that the bloc says are distorting its markets.

The European Commission said on Wednesday that it would raise tariffs on Chinese carmakers to 38 percent, up from the current level of 10 percent, on July 4, unless talks with China can resolve the subsidies issue. The argument over EVs is the latest in a series of trade spats between the EU and Beijing, especially focusing on green technologies.

In a press release, the EU executive said it has reached out to Chinese authorities to discuss the findings of its investigation into the subsidies and “explore possible ways to resolve the issues”.

The new import duties will apply from July 4 “should discussions with Chinese authorities not lead to an effective solution”, it said.

The EU’s action was widely expected amid an investigation into China’s state support for its automakers, who have taken advantage of the 10 percent tariff, which is significantly lower than that imposed by the likes of the US or India.