EU Tariffs on Chinese EVs: Analyzing the Road Ahead

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In this issue, we delve into the recent discussions by the EU Commission regarding tariffs on Chinese imports, a topic of significant importance for the industry. Additionally, we're pleased to report that electric vehicle sales in China continued their upward trajectory in June 2024, underscoring the sector's growth and momentum.

We hope you find this edition insightful and informative!

Stefan Heimlich on EU Tariffs for Chinese EVs: Protectionism or Market Sabotage?

In a recent conversation between Sebastian Henßler, Editor of China EV Pulse, and Stefan Heimlich, Chairman of ACE Auto Club Europa e.V. (ACE), the topic of competition in the electric vehicle (EV) market took center stage. Henßler posed a critical question: "Is it the responsibility of automotive manufacturers to compete against their Chinese counterparts, or should the EU Commission intervene with regulatory measures like tariffs?"

Heimlich’s response was clear and consumer-focused. "From the consumer's perspective, I've made it clear: we want to enter the volume segment. We don't want to promote expensive cars with subsidies—those who can afford them don't need state aid," he stated. This stance has led ACE to firmly oppose government-imposed tariffs on Chinese cars. "Competition is beneficial," Heimlich emphasized.

He elaborated on the advantages of competition by drawing parallels with the retail sector. "We see this repeatedly in the automotive market, as well as in retail—whether you shop at Aldi, Lidl, Kaufland, Rewe, or Edeka. Competition ensures reasonable pricing and prevents monopol pricing and excessive profits, which exist in some sectors," he said. According to Heimlich, artificially high prices would hinder the growth of the electric mobility market.

Heimlich stressed the importance of affordable battery electric vehicles to meet the ambitious goal of having 15 million electric cars on the road by 2030 (in germany), as stated in the coalition agreement. "If we aim to achieve this target, we need affordable battery electric vehicles. If they come from China, so be it. European and German manufacturers will have to rise to the challenge," he remarked. He pointed out that companies like VW have repeatedly delayed the release of key models like the ID.2 and ID.1—from 2025 to 2026, and now to 2027.

"If they believe this is the right approach, the market will penalize them. Consumers will make different purchasing decisions, and that's just the reality," Heimlich concluded. This candid discussion underscores the dynamic nature of the EV market and the critical role of competition in driving innovation and affordability.

Headline Roundup

💡Scholz probably proposes equally high e-car tariffs for EU and China (Electrive)

💡Dispute over punitive tariffs on e-cars: China's trade minister is said to have offered Habeck a deal that benefits German luxury brands (Business Insider)

💡Punitive tariffs: Canada plans to take tougher measures against China (EAN)

💡Germany and China conclude memorandum of understanding on data transfer (Manager-Magazin)

💡Chinese Brands Will Sell A Third Of The World's Cars By 2030: Study (InsideEVs)

CAM innovation ranking: BMW holds the flag high against China

Breaking Down the Numbers

in June 2024

⚡ BYD: 145,179 units - ⬇️ -0.83 % to previous month may

⚡ Li Auto: 47,774 units - ⬆️ +36.42 %

⚡ Nio: 21,209 units - ⬆️ +3.24 %

⚡ Xiaomi: >10,000 units - ⬆️ +15.66 %

⚡ XPeng: 10,668 units - ⬆️+5.14 %

⚡ Zeekr: 20,106 units - ⬆️+8 %

To position Li Auto favorably alongside its 47,774 units sold, there's a difference compared to other OEMs. Most notably, they primarily sold the Li L6, an extended-range electric vehicle (EREV). Their debut electric vehicle, the Li Mega MPV (multi-purpose vehicle), launched on March 1, has shown relatively weak performance thus far.

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Sebastian & team | China EV Pulse