The imposition of provisional tariffs requires automakers to provide European countries with financial guarantees of eventual payment, although they do not need to send money yet.
The provisional tariffs vary considerably by automaker based on the European Union’s estimates of the scale of each Chinese manufacturer’s government subsidies. The highest tariffs are being imposed on manufacturers that disclosed little about their subsidies, including a tariff of 37.6 percent on SAIC Motor. Lower tariffs apply to BYD, at 17.4 percent, and Geely, at 19.9 percent.
Automakers will need to guarantee that they will be able to make payment for vehicles that arrive in the European Union starting Friday, for a period that runs through October. However, the bloc must still determine in the coming months if the subsidies for Chinese cars have caused significant harm in Europe’s car market.
Worries are spreading among governments around the world that China is seeking to export its way out of economic difficulty as a housing market crash has made Chinese households less willing to spend. In May, President Biden quadrupled U.S. additional tariffs on Chinese electric vehicles, to 100 percent.
Turkey imposed 40 percent additional tariffs last month on gasoline-powered and hybrid gasoline-electric cars imported from China. Turkey had already put additional tariffs last year on China’s electric cars. On Tuesday, Canada began a trade investigation that could also lead to tariffs on electric cars from China.
