Source: Gasgoo
Volkswagen Group said higher EU import duties on Chinese-made electric cars would only provide a brief respite for automakers, and that reducing costs was necessary to remain competitive in the long run. Arno Antlitz, Volkswagen’s chief financial officer, said this was because Chinese carmakers would start producing cars in Europe.
On May 22, as trade tensions between the United States and the European Union escalated with China, China said it was prepared to impose tariffs of up to 25 percent on imported cars with large engines.
Antlitz wrote on LinkedIn: “We have to become more competitive on cost over the next two to three years. It is highly doubtful that the current tariffs will go in the right direction.”
Image source: Volkswagen
Antlitz said: “The next few years represent an important opportunity to improve our cost competitiveness. This will improve the price-performance ratio of our electric vehicles, while ensuring that we earn sufficient margins to fund our future transformation.”
Car companies once again find themselves at the centre of shifting global trade patterns, with carmakers such as Volkswagen, BMW and Mercedes Benz particularly vulnerable to Chinese countermeasures. All three companies count China as their biggest market, and all of Mercedes’ luxury S-Class and Maybach models sold there are imported.
The EU will inform Chinese exporters of the results of an investigation into subsidies for electric vehicles in early June, with the possibility of higher tariffs on top of the current 10 percent levy taking effect a month later.
Last year, Chinese carmakers such as MG and BYD accounted for less than 9 per cent of all-electric vehicle sales in Europe, a figure that is expected to rise to about 20 per cent by 2027, Transport & Environment, a European lobby group, said in March.
BYD is currently planning to build two factories in Europe, where it will release a Seagull hatchback model priced under 20,000 euros ($21,657) next year, a move that will have a big impact on the electric car offerings of Volkswagen, Stellantis and Renault.
