Chinese carmakers take action against EU tariffs

Chinese auto companies and industry associations are taking active action against the EU’s provisional tariffs on Chinese electric vehicles (EVs). SAIC Motor Corp said on Friday it demands the European Commission (EC) hold a hearing on the tariffs as the company seeks to further exercise its right to safeguard its own legitimate rights and interests as well as the benefits of its global customers.

China’s Foreign Ministry stressed at a regular press briefing on Friday that China always believes the two sides should resolve trade issues through negotiations and will take “necessary measures” to firmly safeguard its own legitimate rights and interests.

Observers said consultations between China and the EU on the bloc’s anti-subsidy investigation into Chinese EV companies will be very difficult, urging the EU to show more sincerity so that the two sides can reach a balanced and win-win outcome before a final decision is made by the EU in November.

SAIC Motor said in a statement posted on Chinese social media platform Sina Weibo on Friday that the EC, the EU’s executive body, revised down the additional tariffs facing the company to 37.6 percent from 38.1 percent announced in pre-disclosure on June 12, after the company submitted its defense.

SAIC Motor said the EC’s anti-subsidy investigation involves commercially sensitive information that exceeds the scope of normal investigation and that there is an error in the EC’s recognition of subsidies. The EC also neglected partial information and defense opinions that the company submitted during the investigations.

The China Chamber of Commerce for Import and Export of Machinery and Electronic Products (CCCME) said on Friday that the EC’s recognition of so-called subsidies within the Chinese EV companies involved is unreasonable and seriously violates related WTO and EU anti-subsidy rules, urging the EC to correct its mistake as soon as possible.

Representing the Chinese EV industry, the CCCME further stated that it will continue to deal with the EC’s anti-subsidy investigation and firmly protect the legitimate rights and interests of Chinese enterprises through various means.

The EC confirmed provisional import tariffs on some Chinese EV manufacturers from Thursday, despite strong opposition from government officials and major industry players within the bloc.

“In the next four months, there is still plenty of room for consultation and negotiation between China and the EU so that a solution acceptable to both sides can be found,” Liang Ming, director of the Institute of International Trade under the Ministry of Commerce at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times.

The EU has announced several restrictive trade measures against China since the beginning of the year, but China has continued to expand imports from the EU, demonstrating its positive attitude in dealing with the EU, Liang said.

He Weiwen, a senior fellow at the Center for China and Globalization, told the Global Times on Friday that the EU’s protectionist move will not only cause European consumers to pay higher prices for EVs, but will also harm the interests of some European companies, as a large proportion of Chinese EVs exported to the EU involve products made by European companies in China.

If China and the EU can resolve the trade dispute through negotiations, it will bring benefits to both sides, He said, urging the EU to show more sincerity in consultations with China.

He said China and the EU have formed a new energy vehicle industrial chain that is highly interdependent. For example, China’s leading battery maker CATL has invested in the EU, while a large number of German automakers have also seen robust growth in China in recent years.

By jointly developing comprehensive and large-scale new energy vehicle industrial and supply chains, China and the EU will boost green and low-carbon development, bring sustained prosperity to the auto industries on both sides, and contribute to the upgrading of the global auto industry, he said.

Some European leaders and companies have voiced opposition to the EC’s move, saying it will harm both the European auto industry and consumers and undermine efforts to achieve carbon neutrality.

BMW Group Chairman Oliver Zipse said in a statement sent to the Global Times that the EU’s approach is impractical and potentially harmful to European automakers involved in global operations.

Mercedes-Benz Group told the Global Times that the company has always “supported liberal trade regulation based on WTO rules. This includes the principle that all participants meet the same conditions. Free trade and fair competition ensure prosperity, growth and innovation.”

If a general trend towards protectionism gains momentum, this will have negative economic consequences for all stakeholders involved, Mercedes-Benz warned.

We must firmly protect our rights to conduct normal trade and will not allow other countries to randomly attach so-called “overcapacity” and “subsidy advantage” labels to China. If the US and the EU insist on unreasonable suppression of Chinese companies, we could take countermeasures in line with WTO rules, Liang said.

Via Global Times.