<img src='https://news.cgtn.com/news/2024-10-08/Impact-of-U-S-tariff-hikes-on-Chinese-products-limited-1xwXwPbE9va/img/37526eb27bb14036b76e529421296873/37526eb27bb14036b76e529421296873.jpeg' alt='A view of the China Intelligent Vehicle and Autonomous Driving Expo at Shanghai National Convention and Exhibition Center, Shanghai, China, August 8, 2024. /CFP'
Editor’s note: Zhou Jianjun is an assistant researcher at the Institute of National Systems and School of Economics at Zhejiang University. The article reflects the author’s opinions and not necessarily the views of CGTN. It has been translated from Chinese and edited for brevity and clarity.
The U.S. government has decided to raise tariffs on some products imported from China to strengthen the protection of its strategic industries.
According to the announcement released by the U.S. Trade Representative’s Office, some tariff adjustments took effect on September 27, including a 100 percent tariff on Chinese-produced electric vehicles (EVs).
Limited impact from increased tariffs as China exports only small number of EVs to U.S.
China’s EVs have been exported mainly to ASEAN and EU countries, with the U.S. market accounting for only an insignificant percentage.
According to Chinese customs data, only 12,500 Chinese EVs were exported to the U.S. in 2023, making up less than 1 percent of the total exports.
The U.S. is increasing tariffs on Chinese EVs to block them from entering its market, but this move will not affect China’s overall EV exports.
From January to August, China exported 1.31 million units of EVs, a rise of 25 percent year on year.
As EV penetration rates are generally low in major countries, there is tremendous potential for market expansion, and China’s EV exports are expected to maintain breakneck growth in the coming years.
<img src='https://news.cgtn.com/news/2024-10-08/Impact-of-U-S-tariff-hikes-on-Chinese-products-limited-1xwXwPbE9va/img/d1aa6b52e6d3480ca319d772e2d3db5a/d1aa6b52e6d3480ca319d772e2d3db5a.jpeg' alt='Chinese EV brand ZEEKR loads vehicles at Nansha Automobile Terminal in Guangzhou, the largest vehicle terminal in south China, July 2, 2024. /CFP'
Tariff hikes will not curb China’s EV sector dominance
Unlike traditional fuel vehicles, China has achieved technological autonomy and market dominance in the EV sector, possessing core patents and manufacturing technologies, a complete industrial chain, and a mature consumer market.
China’s EV production and sales have surged from less than 100,000 units in 2014 to over 9 million units in 2023.
The scales of production and sales have experienced a 100-fold increase in a decade, with a domestic market penetration rate exceeding 30 percent.
This has helped the automotive industry become China’s second-largest economic pillar.
The U.S. imposition of high tariffs on Chinese EVs is undoubtedly a shortsighted move that can neither hinder the flourishing of China’s EV industry nor achieve the long-term goal of revitalizing U.S. industries.
Global energy transition presents vast market opportunities; Chinese EVs well received internationally
As the world undergoes an energy transition and a new energy revolution, the extensive adoption of clean energy sources like solar and wind is driving down electricity costs, thus continuously expanding the EV market.
The International Energy Agency predicts that global EV sales could exceed 17 million units in 2024, accounting for over 20 percent of the total automobile sales. It is expected to surpass 50 percent by 2035, as more and more countries around the world are promoting EVs to reduce energy consumption, cut carbon emissions, lower dependence on oil and ensure energy security.
Middle Eastern countries such as Saudi Arabia, Egypt and Qatar have launched EV promotion plans, and EVs are being increasingly recognized. Chinese EVs, known for their high quality and cost-effectiveness, enjoy great popularity in international markets.
<img src='https://news.cgtn.com/news/2024-10-08/Impact-of-U-S-tariff-hikes-on-Chinese-products-limited-1xwXwPbE9va/img/30f11da8e52e4ad9aee7458c74cdc981/30f11da8e52e4ad9aee7458c74cdc981.jpeg' alt='Workers assembling electric vehicles at a BYD plant in Thailand, July 4, 2024. /CFP'
China actively promotes global expansion of EV industry, shares new energy dividends worldwide
To counter U.S. tariff barriers, China is actively encouraging its EV companies to expand abroad through methods such as overseas mergers and acquisitions, investments and the establishment of factories.
Companies like BYD, Changan Auto and GAC Aion have set up EV production bases or sales networks in regions like Southeast Asia, South America and the Middle East.
They have collaborated with local companies to localize their operations, thereby contributing to technological advancement and industrial upgrades in host countries while boosting global expansion of China’s EV industry.
China will also strengthen Sino-U.S. trade negotiations, develop entrepot trade, diversify exports and enhance trade promotion efforts. These active measures will help relevant industries in China mitigate the adverse impacts brought about by the U.S. tariff hikes.
(Cover via CFP)
