Punitive tariffs on Made in China EVs likely to restrain BYD, Leapmotor and peers from US market, hurt go-global plans

Name: ‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market
Uploaded: 2024-05-14T06:35:28.000Z
Duration: 12 min 53 s
Description: ‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market

The Biden administration will raise tariffs on electric vehicles to 100 per cent, as part of levies on US$18 billion of Chinese goods to protect US producers

Chinese carmakers are already bracing for similar action in Europe, following a probe on unfair practices of state subsidies for EV makers

Reading Time:3 minutes

Why you can trust SCMP

Export-bound BYD electric cars waiting to be loaded onto a ship at a port in Yantai in eastern Shandong province. Photo: AFP

Daniel Renin Shanghai

Published: 2:35pm, 14 May 2024Updated: 10:12am, 27 Sep 2024

Punitive tariffs on Chinese-made electric vehicles (EV) by the Biden administration are likely to deter BYD, Zhejiang Leapmotor and local peers from pushing their sales in the US, even as they accelerate the pace of electrification in the global automotive industry, analysts said.

Some EV makers in mainland China will turn cautious on their overseas expansion drive after the US proceeded to slap a 100 per cent duty on imported Chinese battery-powered cars, they added. These carmakers are already bracing themselves for another blow in Europe, after the European Commission started a probe last year into Beijing’s subsidies for carmakers.

“The US market is of vital importance to the global automotive industry,” said David Zhang, director of WDEF Digital Automotive International Cooperation Research Centre in Hangzhou. “Chinese EV assemblers will face big hurdles in building brand awareness around the world without strong sales in the US.”

The White House on Tuesday announced a quadrupling of tariffs on Chinese-made EVs from 25 per cent, in an array of measures to hit US$18 billion of Chinese imports that it said would protect US companies from unfair subsidies doled out by Beijing to its companies. Lithium batteries, steel, critical minerals, solar cells, and semiconductor chips were also slapped with higher levies.

President Joe Biden was also expected to maintain tariffs on more than US$300 billion worth of Chinese goods that were imposed during Donald Trump’s presidency, taxes that sparked a costly trade war between the world’s two biggest economies.

12:53

‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market

China had earlier responded to the imminent hikes by saying the US was politicising trade issues, while abusing the so-called review process of tariffs. China will take all necessary measures to defend its rights and interests, said Lin Jian, a spokesman for the Foreign Ministry.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x