According to news on September 15, two days ago, European Commission President von der Leyen announced in the European Parliament’s annual State of the Union address that the European Commission had officially launched a countervailing investigation into electric vehicles imported from China. According to the EU Countervailing Regulations, a preliminary ruling will be made within 9 months after the official launch of the investigation, and a final ruling will be made within no more than 13 months. The objects of the investigation are currently imported goods, and there will be no traceability of imported goods before the start of the investigation.
Here are 3 big questions about this move:
1. How much has China’s electric vehicle exports to Europe increased?
Europe has become the main export market for Chinese automobile brands. Customs data shows that in the first seven months of 2023, China's new energy vehicle shipments to the EU increased by 112% year-on-year and 361% compared with 2021.
The European Commission said China's share of electric vehicles sold in Europe has risen to 8% and could reach 15% by 2025.
2. Why are electric cars made in China cheaper?
This is mainly due to the government's 10-year industrial promotion policy of incentives and subsidies, which has made it the world's largest electric vehicle market and has a global electric vehicle supply chain including raw materials.
The European Commission says Chinese-made electric cars are typically a fifth cheaper than EU-made models.
The policy has also spawned industry heavyweights such as Contemporary Amperex Technology (CATL), the world's largest electric vehicle battery maker, and BYD, which this year overtook Volkswagen as China's best-selling car brand.
China's cost and supply chain advantages attract foreign companies to produce in China. The most famous of these is Tesla, whose giant factory in Shanghai produced more than 700,000 vehicles in 2022, accounting for half of the American automaker's total output. Renault and BMW also make cars in China for export.
3. Who is the target of the EU investigation?
The EU's countervailing investigation covers battery-powered cars from China and therefore non-Chinese manufacturers in the Chinese market.
The Center for Strategic and International Studies, an American think tank, said the largest single exporter is Tesla. From January to April this year, Tesla accounted for 40% of China's electric vehicle exports.
Popular Chinese brands exported to Europe include Geely's Volvo and Automobile's MG.
Others, including market leader BYD, NIO and Xpeng Motors, have also begun expanding into European countries, including the Netherlands and Denmark. (little)