The European Union voted on Friday to impose higher tariffs on electric vehicles imported from China, risking tensions with an important trading partner in an effort to protect an industry crucial to Europe’s economy.
The decision affects billions of dollars of trade between two of the world’s biggest economic powers. The move also reveals how the European Union is struggling to reconcile the conflicting interests of its members, some of whom see China as an essential partner while others view it as a dangerous competitor.
The tariffs are much lower than the 100 percent duties imposed by the United States and Canada, but analysts said they reflected Europe’s willingness to build bridges with Washington by taking a tougher stance on China, but without shutting out Beijing entirely.
The vote sends “a signal that there’s an emerging consensus in Europe that stronger pushback against China on the economic front is needed,” said Noah Barkin, a senior fellow at the German Marshall Fund who specializes in Europe’s relationship with China.
The tariffs, which take effect on Oct. 31 and last for five years, go as high as 45 percent. But both European and Chinese officials have said they remain in negotiations to reach an agreement that would address Brussels’s concerns about unfair advantages enjoyed by automakers in China.
“The E.U. and China continue to work hard to explore an alternative solution,” the commission said in a statement on Friday, adding that any deal would have to be within the rules set by the World Trade Organization.
China, which had lobbied individual countries to reject the tariffs, on Friday criticized the vote and called for the European Commission to delay the implementation of the duties while negotiations between the two sides continue. China is the European Union’s second most important trading partner, after the United States.
The China Chamber of Commerce to the European Union said in a statement that it was “deeply disappointed with the voting results and strongly dissatisfied with the E.U.’s push for trade protectionism measures.” It argued that the competitive advantages of Chinese electric vehicles stems not from subsidies, but from a supply chain that has developed through fierce market competition inside the country.
European officials have said that the tariffs could be called off, or even reversed once implemented, should they reach an agreement with the Chinese that addresses their concerns about unfair advantages.
The Biden administration has voiced concerns that internet-connected Chinese cars and trucks pose a national security risk because their operating systems could send sensitive information to Beijing, but Europeans are more concerned about protecting their automotive industry. Last year, that industry provided 13.8 million jobs and accounted for 7 percent of the region’s economic output.
In Germany, which was one of only five countries that voted against imposing the tariffs, automakers and the government are concerned that the move could set off a trade war with China. Germany’s three biggest automakers, BMW, Mercedes-Benz and Volkswagen, are all heavily invested in China.
Others argue it will encourage the Chinese companies to shift their production to Europe, creating jobs for E.U. citizens and bringing their expertise to the continent.
Chinese companies including Chery and Leapmotor have already set up joint ventures with automakers in Europe with an eye to producing cars there. BYD, China’s leading automaker, is racing to build its first factory in Europe, working with distributors across more than a dozen European countries to offer electric and hybrid models.
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