EU’s tariffs may stall SAIC’s exports of EV but do little to keep BYD at bay, analysts say

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The additional levies will not be severe enough to shut most Chinese-made electric cars out of the market, according to analysts

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MG cars for export wait to be loaded onto a cargo vessel at a port in Lianyungang, Jiangsu province. Photo: Reuters

Daniel Renin Shanghai

Published: 8:00am, 14 Jun 2024Updated: 1:22pm, 14 Jun 2024

The European Union’s proposed import tariffs on electric vehicles (EVs) will do little to keep Chinese brands at Europe’s gate, as the most innovative and cost-effective assemblers like BYD can overcome any hurdle, analysts said.

“The tariffs will only affect Chinese brands’ exports to Europe in the near term,” said Guotai Junan Securities analyst Wu Xiaofei.

That is a relief for an industry that had been awaiting the EU’s nine-month anti-subsidy investigation, which culminated this week in punitive tariffs ranging from 17.4 per cent to 38.1 per cent on pure-electric cars made on the mainland.

Unlike the quadrupling of tariffs announced by the White House last month, whose impact appears to be minimal because few Chinese-made EVs are sold in the US, potential curbs by the EU have been weighing on industry officials and analysts since the investigation started last September.

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Chinese-made electric vehicles face additional EU import tariffs of up to 38%

The 27-member EU, with a combined population of 450 million people, is particularly important for China’s EV exporters amid a crushing price war at home. The EU is poised to become China’s biggest automotive export destination by 2030, with 2 million vehicles – about 20 per cent of the continent’s market – sold annually, according to a 2023 forecast by the Swiss bank UBS.