The European Union and China have agreed to reopen negotiations over the bloc’s punitive tariffs on electric vehicles imported from China, with discussions now centering on a potential agreement to impose minimum prices instead of levies. The shift in approach comes amid mounting global trade tensions, notably driven by U.S. tariff policies under former President Donald Trump.
According to a report by Handelsblatt, EU Trade Commissioner Maros Sefcovic recently held talks with Chinese Commerce Minister Wang Wentao, with both parties agreeing to explore alternatives to the current tariffs.
See also: China, EU Discuss Strengthening Trade Ties Amid U.S. Tariff Moves
The idea of minimum pricing for Chinese-made EVs had been floated as early as November last year, but has gained renewed momentum in recent weeks. Further discussions are expected during Spanish Prime Minister Pedro Sánchez’s visit to Beijing, where he is scheduled to meet with Chinese President Xi Jinping. Sánchez is a vocal critic of the EU’s current tariff regime.
The proposed arrangement would move beyond tariff relief and include broader industrial commitments. Brussels is reportedly seeking assurances that Chinese EV manufacturers will not only build assembly plants in Europe but also invest in comprehensive industrial infrastructure. This would include partnerships with local suppliers and potential technology transfers, aimed at reinforcing the region’s automotive ecosystem.
See also: Analysts See Limited Impact on Chinese Carmakers from New U.S. Tariffs
The transition from special tariffs to a minimum pricing model is intended to shield European automakers from price undercutting while allowing Chinese manufacturers to retain the difference above the set price. However, critics warn of enforcement challenges. A similar system was implemented for Chinese solar modules in 2013 but proved difficult to monitor, with widespread circumvention and limited success in protecting European producers.
Although the tariffs imposed in 2024 were initially designed to remain in effect for five years, sources in Brussels view the early move to renegotiate as a diplomatic concession to Beijing. As trade relations shift in response to global political developments—particularly since the 2024 U.S. election—both China and the EU appear motivated to avoid prolonged disputes. China has already signaled its willingness to ease tensions by postponing proposed retaliatory tariffs on European spirits.