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Home » German Minister Speaks Out Against EU’s Possible Protective Tariffs on Chinese EVs

German Minister Speaks Out Against EU’s Possible Protective Tariffs on Chinese EVs

by Calvin Smith

The German Transport Minister on Monday spoke out against protective tariffs that could be imposed by the European Union (EU) on Chinese electric vehicles (EVs).

“In principle, I don’t think much of erecting market barriers,” Volker Wissing told Augsburger Allgemeine newspaper. “Today, cars are being sealed off, tomorrow it’s chemical products, and each individual step in itself makes the world poorer,” he said.

“We have to make sure we produce our electric vehicles competitively – for Germany and for world markets,” Wissing said. A trade war, on the other hand, could quickly spread to other sectors and cause massive economic damage, the German politician warned.

For the German car industry, for which China is the largest customer, the measures would be a threat, according to experts. “There is a very great risk … We need cooperation with China, not a trade war,” said Ferdinand Dudenhoeffer, director of the CAR Center Automotive Research Duisburg.

More than one in three of the Germany’s biggest carmaker Volkswagen’s vehicles delivered in August went to customers in China, according to the company.

With a value of 6.3 billion euros (6.68 billion U.S. dollars), motor vehicles and parts were Germany’s top selling product by value in China in the first quarter, according to official figures.

If Europe’s largest economy were to decouple from China economically, its gross domestic product (GDP) would drop by 2 percent. This would result in annual losses of 57 billion euros, according to a recent study on behalf of the Foundation for Family Businesses.

China and the EU have a broad space for cooperation and common interests in the automotive industry, a spokesperson with China’s Ministry of Commerce said earlier this month, adding that after years of development, they have formed a pattern of mutual support.

As part of its “In China for China” campaign, Volkswagen recently strengthened its commitment to the country by acquiring a 4.99 percent stake in the Chinese EV startup XPeng. Meanwhile, the group’s brand Audi further expanded its cooperation with its Chinese joint venture partner SAIC.

Other carmakers, such as Geely and Daimler, are also cooperating closely with each other. With this in mind, Wissing said, “Only international trade in global markets creates wealth gains.” (1 euro = 1.06 U.S. dollars) 

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