Executives of German carmakers as well as the German Association of the Automotive Industry have repeated their opposition as the European Union threatens to impose punitive duties on China-made electric vehicles as early as July. Oliver Zipse, Chairman of BMW’s Board of Management, said that the move could upend the EU’s Green Deal and harm German automakers which import cars made in China. “You could very quickly shoot yourself in the foot,” Zipse told reporters after the German premium automaker reported quarterly results. The EU launched an investigation in October into whether fully-electric cars manufactured in China were receiving distortive subsidies and warranted extra tariffs. The probe is due to conclude by November, but the EU could impose provisional duties in July. Zipse said that BMW and other automakers have “bilateral dependencies not only on the final product but also on the component and raw materials side”.
Imposing duties could backfire as new EU carbon dioxide emission standards that will require more EVs – that are reliant on Chinese battery materials – kick in from 2025. “There will be no single car in the EU without components from China,” Zipse said. His latest warnings came days after he told the China Daily in late April that BMW is “not a fan of the investigation”, adding that “it is not necessary”. He said most of the EVs imported in Europe from China are from non-Chinese carmakers. “So if you look at it that way, BMW is a Chinese company, because we are exporting vehicles from China to Europe. We should all work on reducing trade barriers, not increasing them, because the majority of tests we have in the world have to be done together,” he said.
Ola Kaellenius, Chairman of Mercedes-Benz’s Board of Management, has warned against raising tariffs as well. “My suggestion to policymakers was, if anything, lower it, don’t raise it,” he told China Daily at the 2024 Auto China exhibition. “Let competition play out,” said Kaellenius, adding that the company is “pro-free trade and a level playing field”.
Also at 2024 Auto China, Hildegard Mueller, President of the German Association of the Automotive Industry (VDA), said the EU’s measures against Chinese EVs such as additional tariffs would not solve the challenges facing the European automotive industry. Mueller told China Daily that the EU’s trade barriers would quickly have a negative effect. “What is needed instead is an active industrial strategy, including an active trade policy,” she said. The VDA calls for an open and fair market, where any form of protectionism should not exist, said Mueller. She added that China and Germany are important to each other’s economic development. The VDA’s statistics show that there are around 5,000 German companies operating in China, which have created more than 1.5 million jobs in the country. Those in the automotive sector rank first in terms of investment in China. Meanwhile, one out of six vehicles on Chinese roads bears a German marque. In 2023, German carmakers sold 3.8 million vehicles in the country. Mueller said China and Germany are not only partners but competitors, especially in the automotive industry, but such competition makes the industry more dynamic and innovative, the China Daily reports.
