EU Cuts Tariffs on Chinese Teslas

The European Commission has finalized tariffs on imports of electric vehicles (EVs) from China, following an investigation into alleged unfair state subsidies. Tesla, the American EV manufacturer, will face a reduced tariff of 9%, significantly lower than the up to 36.3% imposed on its Chinese competitors. This decision reflects the Commission's assessment that Tesla benefits less from Chinese subsidies compared to local manufacturers, allowing it to secure a more favorable tariff rate. The revised tariffs come as part of the EU's broader strategy to protect its domestic automotive industry from what it describes as unfair competition from heavily subsidized Chinese EV makers. Other Chinese manufacturers, such as BYD and Geely, will face tariffs of 17% and 19.3%, respectively, while companies that did not cooperate with the EU's investigation will incur the highest rates of 36.3%. The new tariffs will be added to the existing 10% import duty on Chinese EVs. Brussels and Beijing have been engaged in discussions to find a negotiated resolution to the trade dispute, but tensions have escalated, with China filing a complaint with the World Trade Organization (WTO) against the EU's proposed duties. The Chinese Chamber of Commerce to the EU criticized the tariffs as protectionist, warning that they could harm global cooperation and green development. EU member states are set to vote on the proposed tariffs by October 30, which, if approved, will remain in effect for five years and could be extended thereafter.