Import tariffs of 40 to 50 percent will be needed to protect the European car industry from China-based manufacturers, according to a new report.
Why China is winning the electric car war
The European Commission launched an investigation into subsidized electric cars from China in 2023 and warned that subsidy charges could be introduced nine months later. With the deadline looming, a Rhodium Group report warns that tariffs on imports alone will not be enough to slow market gains for Chinese manufacturers.
According to the research, tariffs are expected in the range of 15 to 30 percent as European Commission regulators try to protect local carmakers – which account for seven percent of EU GDP – but even at the higher end of that range, China-based manufacturers will still be able to generate comfortable profit margins.
While going as high as 50 percent would make things more challenging, the Rhodium Group says policymakers can turn to other tools, such as tightening cybersecurity requirements, to stem the flow.
