Yesterday, after 9 months of investigation, the European Commission has concluded that electric vehicles made in China “benefit from unfair subsidisation, which is causing a threat of economic injury to EU BEV producers”. As a result, provisional countervailing duties will be applied from 4 July on imports of battery electric vehicles (‘BEVs') from China, ranging from 17.4 to 38.1%.

On behalf of industrial workers in Europe, industriAll Europe welcomes this conclusion that is based on principles and rules which are necessary to get a fair global competition. Given the growing volume of imported Chinese electric cars and the price gap with domestic producers, EU had to react while respecting rules and procedures that has been adopted to ensure that European strategic interests are protected in global trade. A in-depth 9 month investigation has gathered enough evidence of an unfair competition due to state subsidies provided to car makers by the Chinese government. This is not a pure protectionist reaction but the implementation of one of the trade policy instrument EU has to defend its legitimate interests in global trade.

“The EU can’t have open strategic autonomy as a mantra yet do nothing when one of Europe’s key industries is threatened by massive foreign subsidies abroad. Whereas major economies adopt aggressive policies to protect their markets or export their massive overcapacity, Europe can’t stay silent and passive. Facts are there. Rules and procedures have been respected. What the European Commission has announced today is just strategic common sense” said Judith Kirton-Darling IndustriAll Europe General Secretary.

The provisional tariffs are based on transparent rules and procedures. This is crucial given the risk of a trade escalation that today’s decision could entail. China has already hinted its own tariffs and retaliation measures. In the current context, industrial workers can’t afford the risk of a trade war that would dramatically impact workers well beyond the automotive industry. 

For those reasons, building a negotiated solution securing fair trade and fair competition in the global auto market is crucial, especially to create the economic conditions for the unprecedented investments that the climate transition requires. Every effort must be made in that direction in the four months before the set up of definitive measures and keeping in mind general fair trade principles such as rule-based level playing field, the prohibition of forced labour, and the need to implement robust due diligence systems along the supply chain.

“Workers are always among the first victims of a trade storm. Export restriction, market access limitations, unilateral tariffs always lead to jobs destruction. Negotiated solutions to build a fair competition, based on universal rules and principles, are always better than an endless war where there are only losers” stressed Judith Kirton-Darling.

Extra tariffs, if sometimes necessary, do not make an industrial policy. Industrial workers want to see a comprehensive strategy to transform the European automotive industry to make it in line with the climate challenge. Investment in charging infrastructure, purchase incentives, supply of batteries and raw materials, decarbonised electricity production, and a genuine and just transition framework for workers are the key enabling elements we need to secure the future of the European automotive industry.

“The policy puzzle we need to produce in Europe quality electric vehicles that are affordable is not there yet. This must be the compass for the next European Commission to support the European car industry and its workforce. Otherwise, the tariffs will be useless.” Concluded Judith Kirton-Darling.