European Commission Considers Lower Tariffs On Chinese EVs For Volkswagen And BMW

After implementing a new tariff rate of 37.6%, the European Commission is reportedly considering a reduction in tariffs on Chinese electric vehicles (EVs) imported by German automakers Volkswagen and BMW.

According to Reuters, Volkswagen and BMW could be classified as “cooperating companies,” making them eligible for a reduced tariff of 20.8% on their China-manufactured EVs under the proposed plan. The lower rate would specifically benefit models such as BMW’s China-produced electric Mini and Volkswagen’s Cupra Tavascan, produced by the SEAT brand.

Moreover, these EVs were not included in Brussels’ initial sample analysis when determining the tariff rates, resulting in their automatic subjection to the highest tariff level.

Responses From German Automakers

In particular, the German automotive industry voiced opposition to the tariffs due to concerns of potential retaliation from China, a market where German automakers generated a third of their revenue last year. Notably, Tesla also requested its own tariff rate for Model 3 EVs exported to Europe from its Shanghai plant.

Read More: EU Goes Ahead With Tariffs Up To 37.6% on Chinese EVs

Furthermore, a spokesperson for the European Commission stated that they are analyzing requests from companies that were not producing battery EVs (BEVs) in China during the initial investigation period according to Reuters. The Commission has until autumn to make a final decision on the tariffs, which are currently in a preliminary stage.

With the potential tariff reduction for Volkswagen and BMW potentially occurring, it could set a precedent for other automakers and have far-reaching implications for the competitiveness of European automakers in the global EV market and the future of EU-China trade relations.

As the deadline approaches, the EV industry will be waiting for the European Commission’s verdict. The Commission has assured that concerned parties will be informed of its proposal and allowed to comment before the publication of any definitive measures.

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