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EU Imposes Unprecedented Tariffs On Chinese Electric Cars

by THEFUTURE.TEAM

July 4, 2024

The European Union will impose tariffs of up to 37.6% from July 5 on imports of electric vehicles made in China, EU officials said, raising tensions with Beijing in Brussels’ biggest trade case yet.

KEY FACTS

The tariffs are expected to be in effect for 4 months, during which the “intense” trade negotiations between the European Union and China are expected to continue.

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The European Commission’s provisional tariffs ranging from 17.4% to 37.6% are designed to prevent subsidized cheap Chinese electric cars from flooding the European market

The new duties will vary for different Chinese manufacturers. For example, a rate of 17.4 percent is foreseen for BYD, 19.9 percent for Geely, and 37.6 percent for SAIC.

The temporary trade defense measures are being imposed because Chinese companies are in a more privileged position than their competitors, benefiting from illegal state subsidies, the European Commission said in June.

ACCENT

China does not want to be drawn into another tariff war while it is still trying to cope with new import tariffs recently imposed by the US. Washington effectively ended duty-free imports of a number of goods worth $18 billion, including electric cars. Coming under the blows of the European Commission, Beijing promises to take all necessary measures to protect Chinese companies.

KEY STORY

The EC’s actions are related to an investigation the commission launched at the beginning of October last year, aimed at checking the Chinese government’s subsidized imports of electric cars from Beijing. The EC concludes that such a state subsidy exists and it represents economic harm to European producers by undercutting prices.

Overcapacity in the Chinese industry (not just in the electric car market) is seen as a major problem, including by businesses in Europe, according to a survey. Recently, EC President Ursula von der Leyen commented to the Financial Times that Beijing has a huge overcapacity that is flooding the EU market with artificially cheap goods and gave a clear signal of a response.

First steps as part of this broader economic stand-off were taken by the US by effectively ending zero tariffs on imports from China. Tariffs on a number of goods with a total value of 18 billion dollars were increased, with the minimum increase being 0.25%.

The EU has also said it will take similar measures in a bid to tackle subsidized imports from China that undercut European prices. Some of these measures will probably affect the import of solar panels, the parts of which are mainly Chinese. We go back even further to a US-EU meeting in Leuven in early April of this year where an agreement was reached to strengthen cooperation in clean energy markets. Shortly thereafter, the US imposed higher tariffs on imports of certain goods from China.

All these concerns about the electric car market in Europe are not unfounded. BYD, China’s largest electric car maker, unveiled its models in Europe last month. In December last year, BYD announced its plans to build a factory in Hungary. China’s Nio opened a new showroom in Amsterdam, and in April Chery entered into a joint venture with Spain’s Ebro-EV Motors to develop new electric vehicles.

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Only 1% Of Cyprus Farms Use Precision Farming Technologies

Cyprus remains one of the European Union’s least digitised agricultural economies, with just 1% of farms using precision farming technologies in 2023, according to Eurostat.

The findings come as the EU continues to encourage the adoption of digital tools aimed at improving agricultural productivity, efficiency and sustainability.

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Internet Access Expands, But Digital Uptake Lags

Internet access has improved across the bloc, although adoption remains uneven. Eurostat found that 43% of EU farms had internet access in 2023, with northern and central European countries leading the way.

Denmark, Germany, Slovakia, Latvia, the Czech Republic and Austria all reported internet access rates above 90%.

Greater connectivity, however, has not translated into widespread digital adoption. Farm management information systems, which help farmers manage day-to-day operations, were used by only about 11% of EU farms. France was a notable exception, with around 60% of farms using the technology.

Precision Farming Concentrated In Larger Operations

Robotics adoption also remained relatively limited, with only about 7% of EU farms using robotic technologies. Overall, around 18% of farms with utilised agricultural area employed at least one precision farming technology or practice in 2023.

These included robotics for plant protection, band spraying, variable-rate application, precision crop monitoring and soil analysis. Despite representing fewer than one in five farms, these holdings accounted for around 44% of the EU’s utilised agricultural area.

The figures suggest that precision farming remains concentrated among larger agricultural businesses, where investment in digital technologies is typically easier to support.

Cyprus Lags Behind EU Leaders

Luxembourg, Finland and Estonia recorded the highest shares of utilised agricultural area managed by farms using precision farming technologies, each exceeding 75%.

At the other end of the ranking, Cyprus recorded just 1%, while Greece and Romania reported between 10% and 15%. The results indicate that Cyprus remains at an early stage of digital adoption in agriculture, even as precision farming becomes more widespread across parts of the European Union.