The European Union’s decision to impose new tariffs to curb the influx of Chinese cars has proven effective. This measure was taken to protect European car manufacturers from unfair competition with cheap electric vehicles from China.
As reported by Autoblog on Sunday (August 18, 2024), the higher tariffs have led to a decline in sales of Chinese cars in July 2024. According to Dataforce, the number of new electric vehicles registered by Chinese car manufacturers like BYD and MG in the European continent dropped by 45% in July 2024 compared to June 2024.
“This decline reflects the significant impact of the new tariffs, which came into effect on July 5, increasing import duties by up to 48%,” Autoblog stated.
Some analysts believe that the decline was also influenced by the rapid actions of Chinese car manufacturers to supply their vehicles to dealers before the additional tariffs took effect.
“We saw a major push by Chinese manufacturers to clear their stock in June,” said Matthias Schmidt, an independent automotive analyst based near Hamburg. “This likely resulted in reduced inventory,” he added.
The temporary tariffs imposed by the European Union are indeed aimed at protecting the European automotive industry from Chinese competitors who benefit from state subsidies in battery technology and other fields. With rising political tensions between Brussels and Beijing, China has threatened to take retaliatory measures, although talks to resolve the issue are still ongoing.
However, Autoblog noted that there is still one Chinese car manufacturer that remains strong in its resistance—BYD. The Shenzhen-based Chinese car company has managed to increase its market share from 7.4% to 8.5% in the European electric vehicle market in July compared to the previous year.
BYD managed to sell three times as many electric vehicles in 16 European markets in July compared to the previous year. BYD’s strategy to remain aggressive in the European market, despite facing higher tariffs, is evident from their expansion into Poland on August 6, 2024.
This indicates BYD’s readiness to adapt to the new environment while continuing to expand its market share. However, these higher tariffs will become permanent in November unless an agreement is reached between Brussels and Beijing.
