The European Union’s ongoing negotiations with China on setting minimum import prices for electric vehicles (EVs) face significant hurdles, according to a senior EU official. The talks aim to avert the imposition of tariffs on China-built EVs following the EU’s anti-subsidy investigation, which is due to conclude at the end of October.
“I won’t exclude it, but it seems very, very difficult to reach an agreement by the end of October due to the complexity of the issues,” the official stated on Monday. Cars, being multifaceted products with varying sales channels, complicate discussions compared to previous cases involving homogenous commodities.
The European Commission has received minimum price proposals from the Chinese Chamber of Commerce covering several EV manufacturers and additional offers from various exporters. However, reaching an agreement by the end of the month appears unlikely, and negotiations could extend beyond that timeframe.
China recently urged the EU to avoid individual negotiations on EV prices, warning that such actions could undermine broader bilateral tariff discussions. The EU official noted that it would be unusual to focus on a single proposal and emphasized that all offers must be considered.
The Commission requires any potential price agreement to comply with World Trade Organization rules, adequately address the impact of subsidies, and be enforceable with stringent monitoring to prevent circumvention. A singular price is unlikely, as different producers, depending on their sales value and subsidies, may require varying minimum prices.
The proposed tariffs, which range from 7.8% for Tesla to 35.3% for SAIC, reflect the estimated subsidies received by these companies. The Commission, mindful of past challenges with Chinese solar panels, is determined to avoid similar issues, such as the widespread circumvention of trade measures.
“It needs to be fully enforceable and monitored very closely,” the official added, highlighting the need for a robust solution to prevent circumvention of any price undertakings.
Source: Reuters
