The European Union is considering imposing tariffs on Chinese electric cars, but researchers believe that the proposed tariffs may not be high enough. According to experts, tariffs of 50 percent are necessary to prevent a flood of Chinese electric cars in Europe. However, the Financial Times reports that the Rhodium Group estimates that Chinese manufacturers would still be able to make profits even with tariffs set at the high end of the scale. The European Commission is expected to set tariffs between 15-30 percent, but researchers argue that this may not be enough to deter Chinese manufacturers who receive significant cost advantages.
One example given is the BYD Seal U SUV, which is sold for half the price in China compared to the EU. Import and customs costs add around 13,000 euros to the price in the EU. Chinese production costs are low due to large car factories, which allows them to price cars competitively in the European market. Despite this advantage, researchers argue that higher tariffs are necessary to protect local manufacturers and ensure fair competition.
The European Commission is expected to make a decision on tariffs by the end of the year, with temporary tariffs possible as early as May or June. If implemented correctly, these tariffs could help level playing field and promote sustainable development within the automotive industry. However, if not done carefully, they could also negatively impact consumers and hinder innovation in electric vehicle technology.