China is considering a 25% tariff on foreign vehicle imports with large engines.
China’s tariffs on foreign cars follow President Biden’s increased tariffs on Chinese electric vehicles (EVs) entering the United States. Last week, The White House launched new tariffs on Chinese imports, including over 100% tariff rates on EVs from China.
China’s increased tariffs on foreign-made vehicles may also be a response to the European Commission’s probe on Chinese EV subsidies.
“The probe comes after a surge in EU imports of electric vehicles (EVs) from China, outstripping other Chinese export markets. It may result in the Commission levying countervailing tariffs on EU imports of BEVs from China to offset state subsidies if substantiated and to level the playing field,” noted the European Commission at the start of the probe.
As the EU Commission’s probe on Chinese EVs ends, China is preparing for imposed tariffs on its EV imports into Europe. Europe will allegedly release more information about tariffs on Chinese EV imports by early June.
China is considering tariffs of its own on cars from the United States and Europe. According to China’s Ministry of Commerce, it is thinking of raising its EU car import tariffs from 15% to 25%.
The increased car tariffs would affect vehicles with engines larger than 2.5 liters. Daniel Kollar, the head of Intralink’s automotive and mobility practice consultancy, stated that auto brands like Mercedes-Benz and BMW would be the most affected by China’s increased tariffs on foreign car imports.
Similar to the United States, China is also considering increased tariffs on other EU products, like liquor and dairy.
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