Member states have different views on the EU's punitive tariffs against electric cars produced in China, but there are currently significantly more countries in favour than against. This was the result of a kind of test vote on the increased tariffs.
The EU governments surveyed were divided on the issue in a so-called consultative vote, anonymous insiders told Reuters. Around a dozen EU member states voted in favour of the tariffs, four were against and eleven abstained.
France, Italy and Spain, among others, supported the tariffs, while Germany, Finland and Sweden abstained. The German abstention was explained by government circles with "critical solidarity" towards the EU Commission. Finland expressed doubts, that the punitive tariffs are in the EU's interest, as not all European car manufacturers were in favour of them.
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In fact, German car manufacturers have clearly spoken out against the tariffs. The German car industry owes around a third of its turnover to China and would suffer from countermeasures from China - the People's Republic has threatened to impose punitive tariffs on imported cars with large combustion engines. In addition, BMW (BMW iX3, Mini Cooper) and VW (Cupra Tavascan) also produce in China and would therefore be directly affected by the EU punitive tariffs. In these cases, however, the EU Commission has already signalled concessions in the form of lower tariffs, as Reuters has learned from an anonymous source.
The vote has no binding effect on the EU Commission, but President Ursula von der Leyen is likely to be guided by this opinion when she makes her final decision on the punitive tariffs in November.
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If the Commission decides in favour of maintaining the tariffs, the EU member states would be consulted again, but then in a binding vote. The tariffs would then come into force unless a qualified majority voted against them. In order to prevent the punitive tariffs, 15 countries representing at least 65 per cent of the EU population would have to vote against them.
If the final judgement turns out like the consultative vote, the punitive tariffs would come into force, as only four countries voted against them. However, the high number of eleven abstentions may reflect an uncertain or wait-and-see attitude of many EU members. Germany, for example, apparently does not want to go directly against the EU Commission while it is negotiating with China. The Swedish trade minister is also quoted in the same vein: Dialogue with China to solve problems is very important, the politician said.
The European Commission introduced provisional punitive tariffs of 17.4 to 37.6 per cent on electric cars produced in China on 5 July. The reason given was unfair subsidies by the Chinese authorities.
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The bottom line
BMW, Mercedes and VW, on the one hand, depend heavily on sales in China. They would have to completely reorganise themselves in the event of a trade war. However, countries such as Italy, France and Spain, whose car industry generates little turnover in China, are in favour of punitive tariffs against Chinese electric cars. Let's hope that a compromise is found and it doesn't come to that. After all, tariffs will not make electric cars cheaper.
Source: Reuters