NGO Predicts 25% of Europe’s EV Sales from China in 2024

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NGO Predicts 25% of Europe's EV Sales from China in 2024

Electric vehicles (EVs) from China are increasingly prominent in Europe, a trend that may not be immediately obvious. Last year, Chinese-made EVs constituted 19.5% of the approximately 300,000 EVs sold in the European Union. This figure is expected to rise, with a report from Transport and Environment—an NGO recognized as a leading advocate for clean transportation in Europe—forecasting that these vehicles could make up 25% of the EU’s EV market this year if growth continues as it has.

This uptick includes Tesla and Dacia (owned by Renault) models produced in China, along with vehicles from Chinese firms such as BYD. Tesla was the largest importer of Chinese-made EVs into the EU last year, accounting for 28% of such imports, with Dacia following at 20%. The presence of Chinese automakers in the EU market has surged from a mere 0.4% in 2019 to 7.9% in just a few years, per the T&E report.

The report also suggests that by 2027, brands like BYD, MG (originally British), NIO, and others could command up to 20% of the EU’s EV market, marking a significant jump from 2019 figures.

NGO Forecasts That One in Four EVs Sold in Europe This Year Will Originate from ChinaWhile EVs produced in China tend to be more affordable than their European counterparts, benefiting consumers, the reliance on imports means European money is invested in China’s EV development. This could undermine Europe’s innovation in the long term, compelling EV industry workers to accept lower wages, seek different employment, or move abroad.

To address the growing dominance of Chinese-made electric vehicles (EVs) in Europe, Transport and Environment (T&E) suggests increasing import tariffs as a primary solution. The European Union currently imposes a 10% duty on EV imports from China, but T&E advocates for raising this to 25%. This approach, they argue, would not only level the playing field but also stimulate long-term benefits. The United States is considering even stricter measures.

Raising the tariff would likely make medium-sized EVs from China more expensive than those made in the EU, although larger vehicles and compact SUVs from China might still be more affordable. According to T&E, this tariff adjustment could boost the EU’s budget by an estimated 3-6 billion euros, funds that could then be invested in expanding local clean technology and supply chains.

Furthermore, T&E highlights the disparity in import tariffs on battery cells, which are crucial components of EVs. The current EU tariff stands at a mere 1.3%, significantly lower than the 10% China imposes on EU-made cells and the 10.9% tariff by the United States on Chinese cells. Increasing the EU’s tariff on battery cells could further support the development of the domestic clean tech industry.

Major Chinese firms such as BYD and CATL are proactively adjusting to potential shifts in European Union (EU) trade policies by planning to establish factories within the EU. This strategy would enable them to bypass any future increases in tariffs, while also creating job opportunities for the local workforce. This move suggests that other companies might consider similar expansions should the EU decide to raise import duties on electric vehicles (EVs) and their components.

Transport and Environment (T&E), in its report, advises that even with the imposition of higher tariffs, the objective should not be to protect traditional automakers from competition. Instead, the focus should be on localizing the EV supply chain within Europe. This approach aims to bolster the production and availability of EU-made EVs, making them more accessible and affordable for consumers. T&E emphasizes the importance of establishing a robust regulatory framework to support this transition, ensuring that the push towards electrification benefits the European economy and its automotive industry.

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