The Volkswagen Group is expressing strong opposition to the European Union's potential implementation of tariffs on Chinese electric vehicles (EVs), joining forces with other major automakers like Mercedes and BMW in this plea.
Fears Retaliation
The concern stems from fears of retaliatory actions from China that could severely impact European brands, particularly Volkswagen, Audi, and Porsche.
Recently, the EU held a vote regarding these tariffs, and the final decision now rests with the European Commission. Should the tariffs be approved, it is widely believed that China will respond, a situation that German automakers hope to avoid, according to Motor.
Oliver Blume, CEO of the Volkswagen Group, stated that the EU should consider modifying the proposed tariffs based on the investments made by Chinese companies in Europe.
A Risk for Germanys Automotive Industry
Volkswagen is particularly apprehensive about the consequences of retaliatory tariffs on European cars, which could adversely affect German vehicles that are popular among Chinese consumers.
"Punitive tariffs would pose significant risks for the German automotive industry," Blume said. "We would face serious disadvantages in the Chinese market, which is why we firmly oppose these new regulations."
China is the largest automotive market for the Volkswagen Group, with a substantial portion of the company’s registrations coming from the Asian nation. The imposition of tariffs would increase vehicle prices, undermining competitiveness against local Chinese brands.
Blume emphasized the need for Chinese companies that invest and create jobs in Europe to receive certain benefits, such as exemption from tariffs. These tariffs could potentially exceed 40%, creating a detrimental effect on sales and market access.
Volkswagen is not alone in its opposition; both BMW and Mercedes-Benz have also voiced their concerns about the tariffs. Approximately one-third of their total sales come from the Chinese market, and shutting the door on this critical market is not a viable option for these automotive giants.
