China hit by massive Euro tariffs on EVs

Euro tariffs on EVs
Euro tariffs on EVs

Winging its way to Europe is a new invasive species, it is called the BYD Seagull. A car that is cheap, nicely styled and electric. It is car suited for the school run; it will not break any speed records but will not break the bank either. More importantly, it’s being hit by massive Euro tariffs on EVs from China.

Euro tariffs on EVs

BYD Seagull, one invasive species that Europeans don’t want….

In China, it sells for about USD9600, prices are expected to be double that when it lands in Europe, due to a need for increased safety features, but even at that price it will be a very, very cheap EV for the region.

European manufacturers are understandably worried. The fear is that the diminutive seagull will become an invasive species that will eventually replace the established and indigenous European models and perhaps brands.

The trouble is when you get into a new Chinese car instead of that heady new car smell caressing your nostrils, the smell that wafts over you is that of a rat (proverbially speaking that is).

And it is not just me saying it. On June 12th, after an 8-month probe, the European Union has slapped new tariffs on all Chinese manufactured EV’s accusing the Peoples Republic of unfairly subsidising it’s industry with tax breaks and other incentives.

The tariffs follow a sliding scale between 26% and 48% depending on the level of co-operation the companies involved offered to the investigating commission. This is a substantial increase from the current 10% tariff but pales slightly when compared to the 100% that Uncle Joe Biden just raised in the USA.

The move was largely sponsored by France and already the Chinese have hit back, as they were bound to do, with an investigation of Brandy-dumping in the Chinese market. But who really has the most to lose? 

The car companies will probably bear the brunt of any retaliation and this does not bode well for VW or BMW in particular even though they were not behind the probe.

Already the Chinese government has hinted at a new tax on large engine cars, which probably means BMW including any models made in China and they do make a lot there. And any BMW or Tesla that is made in China for export to the UK, and there are a lot of those, will also be subjected to the Euro import tax. 

One of the big losers may be the MG marque. These are built by SAIC which is a part of the Shanghai Province government. They have been hit with the largest tariffs for refusing to co-operate with the EU probe and also because the French still think that this is a British marque.

Will it stop the Chinese manufacturers, probably not. It may slow them down a little. Most of their offerings are significantly lower-priced than the equivalent Euro competitor but more importantly another invasive species, the BYD Seal, sells for USD24k in China but nearly USD50k in Europe and so they can probably absorb the tariffs without losing very much sleep about it.

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