In a move that has sparked controversy, the European Commission has launched an investigation into the competitive landscape of Chinese electric vehicles (EVs). The probe comes in the wake of concerns raised by European automakers about their ability to produce affordable EVs and catch up with China's dominance in this rapidly expanding market.
European Commission President Ursula von der Leyen announced the investigation, which aims to evaluate the dynamics of the EV industry, just days after executives at Munich's IAA mobility show voiced their apprehensions. They acknowledged the formidable challenge of narrowing the gap with China in terms of affordability and consumer appeal in the EV sector.
This move, however, has not been well-received by Chinese authorities, who have characterized it as a protectionist measure designed to safeguard Europe's own automotive industry under the guise of “fair competition.” Beijing has also cautioned that such actions could have adverse effects on economic ties between the two regions.
The Global Times, a Chinese nationalist newspaper, expressed its disapproval of the investigation in an editorial, stating, “To tell the truth, when Chinese new energy vehicles shone brightly at the recent 2023 International Motor Show in Germany, we heard some envious and even jealous remarks, but we didn't expect Europe's response to be so ‘excessive.'”
Market analysts have raised concerns that if the European Union decides to impose tariffs on Chinese EVs following the investigation, a process that could take up to 13 months, China may retaliate with countermeasures, potentially impacting various European industries.
The Global Times further emphasized that winning the EV market through fair competition is essential for Europe to establish competitiveness in the industry. It called into question Europe's confidence and willingness to take on this challenge.
This investigation is poised to be a prominent topic of discussion during EU trade chief Valdis Dombrovskis' upcoming visit to China later this month. During his visit, Dombrovskis is expected to reiterate the importance of fair competition in the global EV market.