UK Weighs Higher Tariffs on Chinese EVs Under EU Pressure
The United Kingdom is preparing to shift its trade policy toward imposing additional tariffs on Chinese-made electric vehicles. The move is widely seen as a response to pressure from the European Union, which has threatened to exclude the UK from its “Made in Europe” manufacturing preference scheme
The United Kingdom is contemplating the implementation of higher tariffs on electric vehicles manufactured in China, according to recent reports from major outlets such as The Times and The Guardian on October 4. This potential move appears to be a response to pressure from the European Union (EU), which has threatened to exclude the UK from its "Made in Europe" manufacturing preference scheme unless the UK adjusts its tariff policies to align with the EU's.
EU officials have expressed concerns that the UK could serve as a conduit for Chinese products entering European markets, stressing that Britain must adopt similar tariffs on Chinese goods before they can enjoy the same treatment as products from EU manufacturers. Despite potential retaliatory measures from China, British officials have determined that the loss of access to the EU market would be a larger detriment.
According to data from the Society of Motor Manufacturers and Traders (SMMT), 58% of UK car exports in the first half of this year were destined for the EU, while only 4% went to China.
Currently, the EU imposes tariffs of up to 45.3% on Chinese-made electric vehicles, applying a base tariff of 10% plus countervailing duties of up to 35.3%. In contrast, the UK has only a 10% base tariff. This regulatory gap has allowed Chinese automakers, such as BYD, SAIC Motor, and Chery Automobile, to make significant inroads in the UK market.
As of August, these brands combined accounted for 12% of the market, with the Jaecoo 7, a model from Chery Automobile, becoming one of the top-selling new cars in the UK in September.
The surge of Chinese automakers in the UK market is backed by data showing their increasing market share. The UK's decision to potentially raise tariffs on Chinese electric vehicles could have a substantial impact on South Korean automakers like Hyundai Motor and Kia. If Chinese brands face a setback in the UK market, it could open up opportunities for Korean manufacturers.
However, the broader market dynamics might necessitate strategic adjustments from all parties involved. Some Chinese firms, including Chery Automobile, have indicated their intent to proceed with investments in the UK, including establishing domestic production facilities, despite the anticipated tariff barriers. This situation is expected to be closely monitored in the coming months.
Written by urgent.news from BusinessKorea's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
