For months, the German auto industry has warned against making it more difficult for Chinese manufacturers to access Europe with import tariffs. Vain. The tariffs will come into force on Friday. From the EU Commission’s perspective, this is a step to create a level playing field in the fight with highly subsidized companies from the Far East. There is now fear of countermeasures at the corporate headquarters in Wolfsburg, Munich and Stuttgart. “Countervailing duties are generally not suitable for strengthening the competitiveness of the European automotive industry in the long term,” says Volkswagen. “We reject these.” Mercedes boss Ola Källenius calls for restrictions on world trade to be reduced instead of creating new ones. “What we cannot use as an export nation are increasing trade barriers.” BMW boss Oliver Zipse is also one of the critics and warns of a trade war with China. “This runs the risk that the trading partner will respond with countermeasures. Perhaps the availability of essential raw materials for electric vehicles will suddenly become more difficult,” he warned in the F.A.Z. six weeks ago. BMW with further arguments On Thursday, Zipse followed up in a statement from the group: “The introduction of additional import duties leads to a dead end. It does not strengthen the competitiveness of European manufacturers. On the contrary: it actually damages the business model of global companies, limits the range of electric cars available to European customers and can even slow down decarbonization in the transport sector. Such measures are a serious interference with the principle of free trade, which is also propagated by the EU. BMW would be directly affected by the punitive tariffs, for example with its new electric version of the Mini Cooper, which Bavaria is having built by its Chinese partner Great Wall in Zhangjiagang. A regulation applies that, from the industry’s point of view, has absurd elements. Since the vehicle had not yet rolled off the assembly line at the time of the European anti-subsidy investigation, BMW is counted among the non-cooperating companies that did not adequately answer the questionnaire on Chinese state aid. The maximum rate of 37.6 percent would apply to the electric Mini, the same as what VW’s Chinese partner SAIC has to pay. He mainly exports models of his MG brand from China to Europe and, according to the EU Commission, has not answered questions or has not answered them adequately. BYD, on the other hand, has cooperated and is now being hit with 17.4 percent additional tariffs. BMW fears that the new E-Mini will become practically unsaleable on the European market with a high tariff surcharge – or will have to be sold at a loss. VW is facing the same problem with its Cupra Tavascan electric car, which has only recently been produced in the Chinese province of Anhui and shipped from there to Europe. Only a few models of the Spanish VW brand have been sold so far, but several thousand are reportedly already on ships heading to Europe. In Wolfsburg they are hoping that the EU Commission will react and adjust the rate for the Tavascan. The danger of Chinese countermeasures is also more serious. The People’s Republic has already threatened import duties on vehicles with engines over 2.5 liters. This would particularly affect German premium manufacturers. The listed VW subsidiary Porsche, which, unlike Mercedes, BMW or Audi, does not have its own production in China and has to export all models there, is particularly at risk. At the same time, there are fears of a shortage of important raw materials, including those for which there are large reserves outside of China. Lithium, cobalt or nickel are often transported to the People’s Republic for further processing because there are no refineries elsewhere. The industry expects that Beijing will not react with extreme severity immediately, but will first wait for further discussions. Initially, the EU tariffs will apply for four months. “The showdown will come in November when there will be a vote on whether to introduce the tariffs permanently for five years,” says a car manager. The industry is still hoping for a resolution to the dispute. “We see the current willingness to talk on the part of the EU and China as a positive sign and continue to rely on political dialogue,” says Mercedes.More on the topicVW warns that the consequences of the conflict go beyond the purchase prices for electric cars from China. “We will only be able to further strengthen the ramp-up of e-mobility in Europe through precise, selective cooperation with China,” says Thomas Steg, the group’s chief lobbyist in Berlin. He points to the still high proportion of battery cells from China. Production in European battery cell factories also depends on cooperation with Chinese partners who supply the systems for the cell factories. He doesn’t believe that the view of those responsible in Brussels will change and that the situation will ease again soon. “There are many signs that the anti-China sentiment will not subside anytime soon,” he says. “The theme in Brussels appears to be increasingly focused on resilience, strategic autonomy and decoupling.”
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