EU’s move to hit Chinese EV makers with higher tariffs will not affect pricing much: Experts
“PROTECTIONIST BEHAVIOUR”
On Thursday, China said it “reserves the right” to file a suit with the World Trade Organization (WTO) over the tariffs.
Beijing has urged the EU to reconsider the tariffs and stop going further in the “wrong direction”, according to Chinese state news agency Xinhua. It has called the tariffs “protectionist behaviour”.
Mr Sassine from KraneShares concurred, noting that the EU’s attempts to align with the United States has led to “very disappointing decisions”.
Last month, US President Joe Biden announced a 100 per cent tariff on Chinese-made EVs to protect US manufacturers from cheaper imports. Both superpowers have been in a trade war for years.
The additional EU tariffs come as European politics is moving towards a more conservative position. Far-right parties made gains in the recent European parliamentary elections.
The Russia-Ukraine war also prompted the EU and US to find more reasons to put pressure on China to back down from its pro-Russia position, Mr Sassine added.
“I think we’re going to see more inflation in the auto industry in Europe,” he cautioned.
Mr Jones agreed that Europe will see vehicle inflation.
He also called the EU’s move “a bit perplexing” as it will likely not help European competitiveness in the long run or prevent the leading Chinese EV makers from extending their market lead.
Professor Joseph Siracusa, political commentator and dean of global futures at Curtin University, said Europe has to tread carefully as China is its biggest trading partner.
“Going after EVs is okay. It doesn’t affect that much, but the game is changing,” he told CNA938.
“This trouble with raising tariffs – it goes both ways. if you make it harder for me to deal, and I’m going to make it harder for you to deal, at the end of the day, who suffers?
“People suffer – (they) can’t get the televisions, or their computers or whatever it is, at bargain prices.”
