Nandini Roy Choudhury, writer
Brief news
- The European Union has announced a reduction in tariffs on Tesla vehicles imported from China, from 20.8% to 9%.
- The EU will also reduce import duties on other Chinese electric vehicle firms.
- The European Commission has determined that the battery-electric vehicle value chain in China benefits from unfair subsidization and has proposed imposing countervailing duties on BEV imports from China.
Detailed news
On Tuesday, the European Union announced that it would reduce the planned tariffs on Tesla vehicles imported from China from 20.8% to 9%. Additionally, the EU will reduce a number of planned import duties on other Chinese electric vehicle firms.
In June, the European Union announced that it would impose a higher tariff on Chinese electric vehicle imports. The EU determined that these vehicles are “heavily subsidized” and pose a “threat of economic injury” to EV producers in Europe.
The European Commission, the executive branch of the EU, has announced a preliminary conclusion that the battery-electric vehicle value chain in China “benefits from unfair subsidization.” The Commission has also declared that it is in the EU’s interest to impose “provisional countervailing duties” on BEV imports from China.
On Tuesday, the European Union Commission unveiled its proposed decision to “impose definitive countervailing duties on the importation of battery electric vehicles (BEVs) from China.”
The regulatory body stated that it would make a “slight adjustment of the proposed duty rates based on substantiated comments on the provisional measures” after receiving comments from interested parties on its planned tariffs.
Tesla’s electric vehicles manufactured in China will now be subject to import duties of 9% in the EU. This represents a decrease from the EU’s previous projection of 20.8%, which was detailed in a July decision.
Tesla shares experienced a 1% increase in premarket trading in the United States subsequent to the EU’s draft decision.
According to the EU, Tesla was granted its own reduced individual duty rate as an exporter from China.
This development follows Elon Musk’s electric vehicle manufacturer’s “substantiated request” to the European Union for the recalculation of tariffs on its China-made electric vehicles to account for the specific subsidies the company receives in China.
Tesla was unavailable for comment when CNBC reached out to the company on Tuesday.
The tariff rate of BYD, the electric vehicle company that is supported by Warren Buffett, was reduced from 17.4% to 17%. Geely’s tariff rate was reduced from 19.9% to 19.3%, and SAIC’s tariff rate was reduced from 37.6% to 36.3%. A request for comment outside of working hours in China was not promptly responded to by BYD, Geely, and SAIC.
The Commission announced that tariffs of 21.3% will be imposed on other companies that are collaborating with the EU in its investigation into China’s substantial subsidization of EVs. This is higher than the 20.8% rate that cooperating companies would have encountered under the EU’s previous July decision.
Import duties of 36.3% will be imposed on those who refuse to cooperate. This represents a decrease from the preceding level of 37.6%.
Source : CNBC News
