On 17 July, the Bruegel think tank published an analysis of the provisional countervailing duties imposed by the European Commission on Chinese electric vehicles (see EUROPE 13446/1). Its authors explain that European electric vehicle manufacturers will be affected by the tariffs, as some of them also manufacture cars in China, which they then export to the EU. Like Chinese manufacturers, these exporters are likely to increase the prices of their products to offset the cost of the tariffs.
“Higher prices for EVs [electric vehicles] will cause additional damage by directly slowing the green transition and by garbling the Commission’s message about its urgency”, write the Bruegel researchers.
They also believe that customs duties will reduce pressure on European companies to innovate and increase productivity, as they will be less subject to competition from China.
Instead, the authors suggest that the EU should try to negotiate an agreement with China so that it adjusts the price of its batteries to better suit the European market and puts an end to unfair subsidies for Chinese producers of electric vehicles.
See the analysis: https://aeur.eu/f/d57 (Original version in French by Léa Marchal)