Electric cars from China are much cheaper than models from the EU. The EU Commission accuses Beijing of market distortion. Nevertheless, the industry is warning against additional tariffs – and the Chancellor also has concerns.
In the dispute over punitive EU tariffs on electric cars from China, the auto industry is putting pressure on the federal government and calling for resistance from Berlin. In the traffic light coalition, the FDP-led finance and transport ministries are pushing for a German no vote in Brussels. Chancellor Olaf Scholz (SPD) was also critical of possible punitive tariffs. A crucial vote in Brussels is scheduled for Friday. How the federal government will behave remains unclear.
The EU Commission accuses China of heavily subsidizing the entire value chain for electric cars and thus distorting the market. The authority therefore wants to introduce additional tariffs, which in some cases are expected to be more than 35 percent. However, the 27 EU states have a say in the decision. Possible German positions include a no and an abstention. According to the EU Commission, Chinese electric cars are usually around 20 percent cheaper than models manufactured in the EU.
Auto industry warns of global trade conflict
“A vote by the EU states to impose high additional tariffs on electric cars from China from the end of October would be a further step away from global cooperation,” said the President of the Association of the Automotive Industry, Hildegard Müller, to the German Press Agency. “This measure further increases the risk of a global trade conflict.”
Müller demanded that the federal government take a clear stance against the punitive tariffs. Abstention is not an option.
BMW boss Oliver Zipse also demanded that the federal government vote against the punitive tariffs. Prosperity in Germany depends on open markets and free trade. Additional tariffs would harm global German companies and could “conjure up a trade conflict that in the end only knows losers.” VW is also urging the federal government in Brussels to say no. When asked by the German Press Agency, a spokesman said: “The proposed tariffs are a wrong approach; they do not improve the competitiveness of the European automotive industry.”
Chancellor relies on negotiations with China
Chancellor Scholz also expressed concerns. “Of course we have to protect our economy from unfair trading practices,” emphasized the SPD politician in Berlin. It’s about level playing field. “However, our reaction as the EU must not lead to us damaging ourselves. That is why negotiations with China regarding electric vehicles must continue.”
Federal Economics Minister Robert Habeck (Greens) had recently repeatedly warned of a customs dispute with China and said that he was counting on a political solution with the People’s Republic.
The topic may also have played a role at a meeting with French President Emmanuel Macron. In the past, Macron had generally spoken positively about punitive measures against China’s electric cars. Scholz went on to say that we had to tackle where cheap Chinese imports were actually damaging the economy, for example with steel. The World Trade Organization and its principles must be given more attention again.
Wissing: Electric cars must be offered at competitive prices
Transport Minister Volker Wissing warned of “market barriers”. These do not represent a suitable instrument for strengthening the competitiveness of the German or European automotive industry, the FDP politician told the German Press Agency. “The future viability of the automotive industry will be measured by whether electric cars can be offered at a competitive price.” The finance ministry headed by department head Christian Lindner (FDP) is in favor of Germany voting no, as sources said.
Source: Stern
