BRUSSELS (Reuters) — The European Commission said on Friday it had enough support from EU members to impose tariffs of up to 45% on Chinese electric car imports in the bloc's highest-profile trade case, but would continue talks with Beijing.
The Commission, which oversees the bloc's trade policy, proposed the latest tariffs on Chinese-made EVs over the next five years to counter what it sees as unfair Chinese subsidies after a year-long anti-subsidy investigation.
In Friday's vote, 10 EU members supported the tariffs, 5 voted against, and 12 abstained.
A qualified majority of the 15 EU members, representing 65% of the EU's population, needed to block the proposal. Reuters reported on Wednesday that the event would go ahead with plans to vote in favor of France, Italy and Poland.
The EU executive said he had the “necessary support” to accept the tariffs, although he would continue talks with Beijing to find an alternative solution.
Sources said on Friday that Germany, the region's biggest economy and main carmaker, voted against the proposal.
BMW CEO Oliver Zipse called the vote “a fatal signal for the European car industry.” According to him, there is a need for a quick settlement between Brussels and Beijing to avoid a trade conflict.
Volkswagen said the planned tariffs were “the wrong approach”.
China's foreign ministry did not immediately respond to Reuters' request for comment
Stellantis said he supported free and fair competition and that the sector was under pressure from ambitious carbon reduction plans and “China's global commercial onslaught”.
Hungarian Prime Minister Viktor Orbán said on Friday that the EU is heading for an “economic cold war” with China.
The EU's stance against Beijing has hardened over the past five years. It views China as a potential partner on some issues, but also as a rival and systemic competitor.
In retaliation, Beijing this year launched its own investigations into imports of EU-branded dairy and pork products.
The commission says China's spare capacity of three million EVs a year to be exported is twice the size of the EU market. Given the 100% tariffs in the US and Canada, the most obvious outlet for these EVs is Europe.
The EU executive has said it is ready to continue negotiating alternatives to tariffs with China and may revise the price commitment, which is usually linked to a minimum import price and volume cap, rejecting previous offers by Chinese companies.
Tariffs range from 7.8% for Tesla to 35.3% for SAIC and other companies deemed uncooperative with the EU investigation. These tariffs are on top of the EU's standard 10% import duty on cars.