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Tesla and BMW are suing the EU as opposition grows over tariffs on Chinese-made electric vehicles.

28.01.2025 10:00 AM
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Tesla and BMW are suing the EU as opposition grows over tariffs on Chinese-made electric vehicles.
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Both BMW and Tesla have been impacted by tariffs on electric vehicle imports from China, alongside other Chinese manufacturers such as BYD and SAIC. The two companies have taken legal action against the European Commission in response to the EU’s tariff measures. This follows a growing movement among Chinese carmakers, including Geely, SAIC, and BYD, who also oppose these tariffs.
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Tesla and BMW are suing the EU as opposition grows over tariffs on Chinese-made electric vehicles.

on tuesday afternoon, tesla's shares dropped 2.32%, while bmw's fell by 0.35%.

both bmw and tesla shanghai have filed lawsuits with the european union’s court of justice, though further details remain undisclosed.

last year, the eu imposed a 7.8% tariff on electric vehicles made by tesla in china, while bmw’s china-made evs were subject to a 20.7% tariff. chinese manufacturers like geely faced an 18.8% tariff, while byd was hit with a 17% tariff, and saic faced a hefty 35.3%. these tariffs are in addition to the standard 10% tariff applied to all car imports into the eu.

bmw has pointed out that the tariffs do little to improve the competitiveness of european car manufacturers. a spokesperson for bmw told the wall street journal, "on the contrary, the countervailing duties harm the business model of globally active companies, limit the supply of e-cars to european customers, and could even slow down the decarbonization of the transport sector."

despite their opposition, bmw remains open to negotiating a resolution and stressed the importance of avoiding trade conflicts, as they often result in negative outcomes for all parties involved.

the european commission has stated that it remains open to negotiations, provided the solution takes into account the unfair competition identified in eu investigations.

if successful, the lawsuits could potentially strip the eu of its right to impose tariffs on chinese products by invalidating the law, allowing the affected companies to seek compensation for their losses.

car manufacturers are struggling with growing competition from chinese companies, which has led to the eu’s decision to impose tariffs on chinese electric vehicles. the eu has expressed concerns that the chinese government’s subsidies to domestic manufacturers are allowing them to sell their vehicles at aggressively low prices in europe, undercutting european competitors.

eu investigations have found that these subsidies include cheaper land, softer loans, and financial support for key suppliers like steelmakers.

in response, several chinese ev manufacturers are focusing on hybrid vehicles to maintain their presence in the european market, as these are not subject to current tariffs. this shift has sparked concerns that the eu’s ev tariffs could become less effective.

european carmakers are losing market share to chinese companies, which offer better prices, discounts, features, and designs. the ongoing cost-of-living crisis in europe has made consumers more hesitant to make big purchases, while also pushing them to seek better deals.

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