Lower EU import tariffs for ‘Chinese’ Minis and Cupras?

Two sources with knowledge of the matter said the European Commission has signaled to Volkswagen and BMW that it may consider lowering tariffs on their imports of China-made EVs.

The sources said the Commission is willing to classify the two automakers as so-called cooperating companies, making them eligible for a 20.8 % additional tariff on their China-made models, down from 37.6% under current plans.

Mini and Cupra

BMW’s China-made electric Mini and the Cupra Tavascan built at Volkswagen Group’s factory in Anhui, China, were not part of Brussels’ sample analysis in the run-up to the tariff announcement, which means they were automatically subjected to the highest tariff level.

If agreed, it would be Brussels’s first early compromise on tariffs that will hurt some of Europe’s top automakers because they build cars in China and import them to the old continent.

Large opposition

There’s a growing concern among almost all European car manufacturers that high import tariffs on Chinese-made vehicles would provoke retaliation from the People’s Republic and finally end up in a trade war that would benefit no one.

The German car industry has most fiercely opposed the tariffs because it worries about this retaliation from China, where German automakers made a third of their revenue last year.

U.S. carmaker Tesla has asked for its own tariff rate on Model 3 EVs exported to Europe from its Shanghai factory. At the moment, all declined to comment on these latest evolutions. Brussels has until November to make a final decision on the tariffs, which are provisional for now.

Further investigation

A spokesperson for the European Commission said it was analyzing several requests from companies that were not yet producing battery-electric cars in China during the initial investigation period on the matter and would make a final assessment later in the process.

“The parties concerned will be informed of the Commission’s proposal and will have the opportunity to comment in advance of the publication of any definitive measures,” the spokesperson added.