China and the European Union have recently reached multiple consensuses on hybrid and electric vehicles.
A spokesperson for the Ministry of Commerce stated on October 12 that regarding hybrid vehicles, both sides emphasized and confirmed three basic principles: first, respect for facts; second, non-discrimination; and third, compliance with regulations. China and Europe continue to engage in dialogue under their trade and investment consultation mechanism, reaching multiple consensus outcomes, which is conducive to maintaining a stable and balanced key trade partnership between the two regions. Based on the principles of mutual respect and equal negotiation, both sides have conducted intensive consultations on the trade of hybrid and electric vehicles, addressing economic and trade differences as well as each other's concerns in a balanced manner.
On the same day, the latest data from the China Association of Automobile Manufacturers showed that in September, China exported 1.053 million vehicles, a year-on-year increase of 61.4%, marking the fourth consecutive month that monthly exports exceeded one million units. In terms of overseas markets, countries such as the United Arab Emirates, Australia, the United Kingdom, and Algeria saw import growth of Chinese vehicles exceeding 50% on average, with some countries even experiencing increases of 200% to 300%.
Just a week ago, British media reported that discussions in the UK about raising tariffs on imported Chinese electric vehicles were intensifying. A spokesperson for the Chinese Embassy in the UK responded by stating that China has always firmly opposed any discriminatory practices of imposing tariffs or restrictive measures on Chinese products, and has expressed serious concerns to the British side regarding these reports.
A person in charge of a Chinese-funded automaker's European market told Yicai News that, on one hand, the relevant discussions in the UK are more "political in significance than practical impact"; on the other hand, it is "impossible for the UK to implement (the relevant tariff measures) in the short term, but the stance is very important." Meanwhile, the British Automobile Industry Association replied to reporters that the information has "not yet been confirmed," and the British automotive industry is currently more concerned with whether they can be included in the EU's "Made in Europe" system.
Currently, when cars manufactured in China (including both electric and fuel-powered vehicles) enter the British market, they are subject to a uniform import tariff of 10%. In contrast, the European Union imposes tariffs of up to 45% on Chinese electric vehicles, which makes the UK one of the few markets in Europe that still maintains relatively low tariffs on Chinese cars.
The UK is more focused on integrating into "Made in Europe".
The UK Department for Business, Energy and Industrial Strategy, which is responsible for trade policy ( DBT ), replied to Yicai Finance, stating, "We closely monitor issues related to electric vehicles in China and work closely with the automotive industry to ensure that our approach takes into account both the interests of the industry and those of the UK."
Mike Horsley, CEO of the Society of Motor Manufacturers and Traders ( SMMT ) in the UK, told a reporter from Yicai that "the UK has always been an open and competitive automotive market, and as long as the competition is fair and the rules are clear, it should continue to be so."
Hoss stated that reports of possible restrictive measures have not yet been confirmed, and any such considerations should be based on sufficient evidence, follow due process, and take into account the interests of consumers, manufacturers, investors, and exporters.
In his view, the top priority at present is to reach a pragmatic agreement with the EU and strive to make the UK a trusted partner recognized by the “Made in Europe” system. According to the current draft of the EU’s Industrial Accelerator Act ( Industrial Accelerator Act ), vehicles produced in the UK will be excluded from the incentives associated with “Made in Europe”. He said that this will severely damage the highly integrated automotive industry between the UK and Europe and endanger the trade relationship worth 80 billion euros per year, “trade restrictions may have unexpected consequences”.
The automotive industry chain between the UK and Europe has long been closely linked. The EU is not only the largest export market for British cars but also an important source of spare parts supply. SMMT data shows that about 80% of the cars produced in the UK are for export, with the EU being the largest overseas market. At the same time, nearly 70% of the new cars imported into the UK come from the EU.
According to analysts from Chinese-funded automakers mentioned above, there are not many automobile factories in the UK, but a considerable portion of their production is sold to Europe, making the UK highly dependent on the EU market. The EU is expanding the scope of coverage of the 'Industrial Accelerator Act', and if the UK does not keep pace with the EU, vehicles exported to Europe may also face restrictions on the EU side.
Industry insiders believe that, in terms of procedures, if tariffs are to be adjusted, it must be initiated by an investigation conducted by the UK Trade Remedies Agency ( Trade Remedies Authority ). Such an investigation requires an application from a company, and "there are currently no such applications." He also mentioned that if the UK insists on taking temporary measures without initiating an investigation, these measures could affect all imported vehicles.
This person from a Chinese-funded automaker also pointed out that currently, among the models sold by Chinese car brands such as Chery, BYD, and MG in the UK market, plug-in hybrid vehicles account for a relatively high proportion; therefore, if the tariff adjustments only target pure electric vehicles, the actual impact may be relatively limited.
The competitiveness of Chinese automakers is rising.
Chinese electric vehicle brands are currently gaining momentum in the UK market. Data recently released by the Society of Motor Manufacturers and Traders (SMMT) shows that in September this year, the number of new car registrations in the UK increased by 12% year-on-year, reaching the highest level for the same period since 2017. Among them, the registration of pure electric vehicles in the UK that month increased by 36% year-on-year, amounting to 99,100 units, accounting for 28.3% of the market share.
Several Chinese brand models became the best-selling vehicles in the UK in September. Among them, Chery's Jaecoo became the best-selling model in the UK market in September, while BYD's Sea Lion 7 ranked as the highest-selling pure electric vehicle in the UK in September, following Tesla's Model and Model Y.
Jason, a British citizen ( Jason ), bought a Jaecoo vehicle half a year ago. He told a reporter from Yicai that he had previously been driving Ford and Volkswagen cars. The reason for changing his car was that this new model "is similar to a Land Rover Range Rover, but much cheaper, and comes with more advanced technological features." In his view, various taxes imposed by the British government have increased the cost of living, and he feels that "this is unfair."
Another British citizen, Timothy ( Timothy ), has a more clear stance: "I am completely opposed to all tariffs; I am a supporter of free trade." He said that when he buys things, he only looks at the price and quality, not the place of origin.
Hos previously stated that the competitiveness of Chinese automobile companies in the global market is on the rise, "The competition from other regions of the world is very fierce, and among them, the most significant is the competition from China." He believes that Chinese automakers possess a complete product range covering fuel vehicles, hybrid vehicles, and electric vehicles, which gives them strong competitiveness in the global market.
On October 6, Guo Jiakun, a spokesperson for the Ministry of Foreign Affairs, stated that the essence of economic and trade relations is to leverage each other's comparative advantages to achieve mutual benefit and win-win outcomes. The development of China's electric vehicle industry has provided competitive options for consumers around the world, including those in the UK, and has also made a positive contribution to green and low-carbon transformation. It represents high-quality production capacity that is in high demand.
