The European Commission has rejected offers by Chinese electric-vehicle makers to adjust their prices in a bid to avoid sharply higher tariffs ahead of potentially pivotal talks between Beijing and Brussels next week.
The tariffs were announced after a months-long probe launched by commission president Ursula von der Leyen that sharply increased trade tensions between the 27-member bloc and China, the world’s second-biggest economy.
EU officials have said the tariffs are needed to protect European manufacturers from being undercut by low-cost, China-made EVs that it says are unfairly subsidised by Beijing.
Olof Gill, the commission’s trade spokesperson, said on Thursday the commission had rejected “offers for price undertakings” by several Chinese auto exporters, but that Europe remained “open to a negotiated solution”.
“Our review focused on whether the offers would eliminate the injurious effects of subsidies and could be effectively monitored and enforced. The commission has concluded that none of the offers met these requirements,” he said. The price offers were confidential.
EU member states will vote on the Chinese EV tariffs by the end of October.
The decision to refuse the Chinese carmakers’ offers comes amid signs of growing divisions within the bloc over China in the wake of fears of a costly tit-for-tat trade war.
China’s commerce minister Wang Wentao will meet the EU trade commissioner Valdis Dombrovskis in Brussels next week.
Gill said it was up to China to find a solution to the EVs dispute that would address the risk of injury to EU industry that the investigation identified. “It’s not up to the commission to be prescriptive about what that solution looks like,” he said. “We are open to negotiation. Over to them.”
The EU has proposed imposing tariffs on China-made EVs of up to nearly 50 per cent, following a US decision to raise tariffs to nearly 100 per cent.
On Wednesday, Spanish Prime Minister Pedro Sánchez said his country was “reconsidering” its position on the EU tariffs. The change in stance moved Spain into line with Germany, which has been lobbying member states to oppose the measures.
China has slammed the proposed tariffs as a sign of rising western protectionism that undermines the global fight against climate change.
Yi Xiaozhun, a former Chinese ambassador to the World Trade Organization, told the Financial Times he still hoped there would be a negotiated settlement.
“In China, nobody wants to see a trade war. I think China is trying its best to avoid it and the US is even tougher for China to deal with. And we do hope that the EU will not join this kind of unilateral protectionism to push China to go through a trade war,” he said.
Since Brussels’ investigation, Beijing has also opened anti-dumping probes into European dairy products, cognac and pork, and has filed a complaint with the WTO. The response has highlighted China’s willingness to hit back against sensitive interests in key EU member states.
Asked if the investigations into EU imports were a result of the EV tariffs, Yi said there was no “direct link”.
“But here is the thing: you need to have a business-friendly bilateral relationship. Otherwise you will get tit-for-tat actions,” he said.
