Initiate the latest price negotiations, EU may cancel the anti-subsidy tax on Chinese-produced electric cars.

On April 10th local time, a spokesperson for the European Commission stated that the EU and China have agreed to study setting a minimum price for electric vehicles manufactured in China in order to cancel the tariffs imposed by the EU in 2024. The spokesperson for the EU stated that EU Trade Commissioner Maros Sefcovic had discussions with Chinese Minister of Commerce Wang Wentao in the past 24 hours, and both sides agreed to study setting a minimum price. The trade strategy of "setting a minimum price" aims to "maintain fairness in the European market and create space for legal trade." Compared to the anti-subsidy tariffs implemented last year, this price control method is more flexible and operational. The so-called "import minimum price" refers to a government setting the lowest price for a certain imported commodity, and any imported goods priced below the specified minimum price will be subject to additional import taxes or prohibited from import to limit the import of low-priced goods. "Before the implementation of the 'anti-subsidy tariffs' last year, the EU had discussed introducing minimum prices for different vehicle models." Lu Shengyun, former research and development engineer at France's PSA Peugeot Citroen and founder of Aspicious Consultancy, said in an interview with China Business News, "In simple terms, the EU restricts the minimum import price for Chinese models sold in the European market, and Chinese companies cannot sell below this price." Lu Shengyun further stated, "Currently, the prices of Chinese car manufacturers selling cars in Europe are generally 30%-40% lower than local European models, so setting a minimum price is a way to indirectly increase the selling price of Chinese electric cars in Europe. This will narrow the cost difference between local European car manufacturers and Chinese car manufacturers, which is beneficial for both sides. For the EU, setting a minimum price will effectively avoid a 'price war' with Chinese car manufacturers in Europe and protect the development of the European automotive industry. For Chinese car manufacturers, although their competitiveness in the European market may weaken correspondingly, the profit per car will increase. I think this is a better solution than the anti-subsidy policy implemented by the EU last year." The German Association of the Automotive Industry (VDA) welcomed the negotiations between the EU and China, stating that these tariffs are a "mistake" and advocating for a negotiated solution to be reached. The VDA stated on Thursday: "No matter how the global situation unfolds, we must discuss here how to reduce barriers and distortions in international trade rather than create new obstacles." Looking back at the dispute. In October 2024, EU member countries voted to impose a maximum of 35.3% anti-subsidy tariffs on electric vehicles manufactured in China for at least five years on top of the existing 10% tariff. In terms of specific tax rates, an additional 7.8% tax was levied on Tesla, 35.3% on SAIC Motor Corporation, and 20.7% on other electric vehicle manufacturers involved in the investigation. After the tariffs were imposed, Chinese electric vehicle manufacturers faced up to 45.3% of high tariffs when entering the European market. It is worth noting that the breakthrough in the negotiations between China and the EU on the anti-subsidy tariffs for Chinese electric vehicles is related to the United States waving the tariff stick at multiple countries globally. On March 26th, U.S. President Trump announced a 25% tariff on imported cars, which took effect on April 3rd. On April 2nd, Trump announced a 20% tariff on goods imported from the EU, which came into effect on April 9th. On April 9th local time, the EU's 27 member states voted to impose retaliatory measures of a 25% tariff on U.S. imported products. The new round of tariff wars initiated by the United States will have an impact on the EU, especially the German automotive industry. Data from the European Automobile Manufacturers' Association shows that the United States is the largest export market for EU cars, with European car manufacturers exporting a total of 38.4 billion euros worth of cars to the United States in 2024, with the three largest German car manufacturers Volkswagen, Mercedes-Benz, and BMW accounting for about 73% of EU car exports to the United States. This article is selected from: "China Business News"; GMTEight Editor: Li Fo.