EU rejects China's proposal for minimum electric car price of 30,000 euros

Although the EU vote on imposing tariffs on Chinese-made electric vehicles ended on October 4, negotiations between the EU and China on this issue are still ongoing.

According to Reuters on the 9th, during the negotiations between the EU and China, China's latest proposal - promising that electric vehicles exported from China to the EU will not be sold in the EU market for less than 30,000 euros to avoid squeezing the survival space of the EU's locally manufactured electric vehicle market - was rejected by the European Commission.

Reuters made the above report based on reports from three sources. In addition, in mid-September, before the vote, Chinese electric vehicle manufacturers proposed a proposal to the European Commission, also promising to sell at a price not lower than a specific price in the EU market. At that time, the proposal was also rejected by the European Commission.

Negotiations between the EU and Chinese governments are still continuing, and both sides still hope to find a possible alternative solution. Among them, an important driving force is Germany, which voted against it on October 4, changing its previous abstention. The EU's punitive tariffs are related to the interests of many German car companies in China, so Germany hopes to promote a last-minute settlement and consensus between the two sides.

The European Commission believes that alternative solutions must also be fully consistent with WTO rules, be able to adequately combat the harmful subsidies found in the European Commission's investigation, and be monitorable and enforceable.

The European Union Chamber of Commerce in China (CCCEU) expressed "deep disappointment" after the EU vote. The Chamber called on the EU to postpone the decision to impose tariffs and continue the negotiation process.

According to information released by Euronews, in the vote among EU member states on October 4, 10 countries voted in favor, namely France, Italy, the Netherlands, Poland, Denmark, Ireland, Bulgaria, Estonia, Lithuania and Latvia (accounting for 45.99% of the EU population), 5 countries voted against, namely Germany, Hungary, Malta, Slovenia and Slovakia (accounting for 22.65% of the EU population), and 12 countries abstained, namely Belgium, the Czech Republic, Greece, Spain, Croatia, Cyprus, Luxembourg, Austria, Portugal, Romania, Sweden and Finland (accounting for 31.36% of the EU population).

According to a study by the EU Transport and Environment Organization (Transport), one out of every five electric vehicles sold in the EU market in 2023 will be imported from China. Including Tesla cars imported from China, Chinese-made electric vehicles account for nearly 20% of the EU's electric vehicle sales.

The organization's survey data shows the initial impact of the EU's two-month temporary tariffs on several major Chinese brands. When comparing the actual data for 2023 with the forecast data for 2024:

MG's sales have fallen the most in the past few months, with its market share falling from 4.1% of the EU electric vehicle sales market in August 2023 to 2.4% in August 2024. The market share has fallen by 41%.

BYD's imports continue to grow. Compared with a market share of 1.6% in August 2023, the market share in August 2024 reached 2.9%, an increase of 81%.

The impact on Geely is between MG and BYD. From 1.3% in August 2023 to 2% in August 2024, Geely's market share has still increased by 58%.

However, the report predicts that imports of Chinese-made electric vehicles will peak this year, close to 25% of the market share; then slowly decrease, returning to around 20% by 2025; and to around 18% by 2026.

The study believes that the downward trend reflects the slowdown in import growth, but it is necessary to take into account the fact that some Chinese brands have turned to local production in the EU, especially BYD, and part of the import volume will be replaced by local production.

The EU's Transport and Environment organization believes that although the EU's tariffs have slowed the growth of some Chinese imported cars, they will not prevent the rise of Chinese electric car manufacturers because their products are of high quality and more affordable. The problem is that European automakers have been slow to respond, and lower-priced pure electric vehicles have only recently been launched to meet the 2025 automobile carbon dioxide emission target.