The UK is mulling over harsher tariffs on imports after one in four electric vehicles sold in Europe will be made in China by the end of the year.
As the UK looks to increase its production of electric vehicles, the threat of China looms closer as its cheaper models are set to dominate the market.
Almost a fifth of electric vehicles sold in Europe last year were made in China with the country on track to reach a quarter in 2024.
The forecast comes as the EU is considering import tariffs on Chinese EV models to help encourage drivers to buy in-house.
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Chinese imports into Europe have largely been Tesla, Dacia and BMW cars
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While Chinese imports into Europe have largely been Tesla, Dacia and BMW cars produced there, new research projects that Chinese brands could reach 11 per cent of the European EV market in 2024 and 20 per cent in 2027.
Julia Poliscanova, senior director for vehicles and emobility supply chains at Transport and Environment, said: “Tariffs will force carmakers to localise EV production in Europe, and that’s a good thing because we want these jobs and skills.
“But tariffs won’t shield legacy carmakers for long. Chinese companies will build factories in Europe and when that happens our car industry needs to be ready.”
This month, Transport Secretary Mark Harper warned that if China tries to undercut competition for electric vehicles in the UK by making prices too low, he will take action.
Speaking at the Society of Motor Manufacturers and Traders conference, Harper stated that the UK could be pushed to put tariffs on Chinese imports of electric vehicles. Tariffs are already in place across Europe.
Currently, Chinese EVs are subject to a 10 per cent tariff when imported to the continent, while European carmakers pay 15 per cent when exporting to China.
The transport organisation explained that raising the tariff on all vehicle imports from China to 25 per cent would make medium-sized vehicles and SUVs more expensive than their European equivalents.
Compact SUVs and larger cars imported from China are expected to remain slightly cheaper with a tariff, however.
Despite the increases, T&E warned that the EU should not shield its carmakers from meaningful competition, which would limit the offer of affordable electric cars for Europeans.
Poliscanova added: “Batteries are the new solar. China is ahead and its state-backed companies have huge overcapacity.
“If we are serious about a diverse and resilient battery supply chain in Europe, we need to put our money where our mouth is right now. We’re not going to get a second chance.”
According to the European Commission, the share of EVs from China sold in the EU jumped from less than one per cent to eight per cent last year, with worries that this share could soar to 15 per cent by 2025.
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There are more than one million registered EVs on UK roads
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Since 2009, China has used a variety of subsidies to scale up BEV production, boost market penetration and build a charging station infrastructure to help achieve its global leadership.
Source Agencies
