China Expresses Dissatisfaction with EU’s Consultations on EV Probe

China has rebuked the European Union's (EU) move to open consultations regarding the electric vehicles (EV) subsidy investigation. The Chinese government expressed dissatisfaction, noting that the EU violated its rights by taking such a hasty step.

This development has resulted in rising contention between the Chinese government and the European Union over trade activities and subsidies, particularly in the electric vehicle sector.

China Slams EU's Hasty Consultations in EV Probe

The dispute focuses on the protection of electric vehicle manufacturers through tariffs, according to the European Commission's investigation, as reported on September 13 by Reuters. This investigation surfaced due to the surge of competitively priced Chinese imports suspected to benefit from state subsidies.

At the time, Ursula von der Leyen, President of the European Commission, highlighted this issue during her annual address to the European Parliament. In her speech, she emphasized the influx of affordable electric vehicles in global markets and cited the role of state subsidies in artificially reducing their prices.

This investigation is expected to be a high-profile case, as it grants the European Commission up to 13 months to determine whether tariffs exceeding the standard 10% EU rate for automobiles should be imposed.

What sets this investigation apart is its scope. Notably, the investigation covers Chinese-made EVs and non-Chinese brands produced in China, such as Renault, Tesla, and BMW.

Meanwhile, the EU actively seeks ways to reduce its dependence on China, particularly for materials and products crucial for its green transition.

China Responds to the EU's Investigation

Responding to the investigation's launch, the Chinese Chamber of Commerce to the EU expressed deep concern and opposition. They argue that the sector's competitive advantage is only partially due to subsidies and urge the EU to approach Chinese electric vehicles accurately.

Also opposing the investigation, a statement from the Chinese Commerce Ministry revealed that they had yet to receive ample consultation materials from the European Union, further complicating the issue.

Furthermore, the Chinese government argued that the investigation lacked adequate evidence and failed to align with the rules of the World Trade Organization.

As a result, the Chinese government has committed to closely monitoring the investigative procedures conducted by the European Commission. The government pledged to strongly protect the rights and interests of Chinese companies involved in the electric vehicle industry.

The Chinese EV Market

Meanwhile, a report revealed a 31% surge in China's auto exports in August, highlighting the industry's global ambitions. However, due to the rising competition in the nation, Chinese EV manufacturers are deliberately expanding their presence in the international markets.

Among these manufacturers are industry leaders like BYD and emerging players like Nio and Xpeng.

Additionally, the investigation from the European Commission points out that China's share of electric vehicles sold in Europe has risen to 8%, with chances of reaching 15% by 2025.

Notably, these Chinese EVs are typically priced approximately 20% lower than their EU-made counterparts, making them an attractive option for European consumers. Among the popular Chinese models exported to Europe are Geely's Volvo and SAIC's MG.

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