Now the European Commission actually wants to impose punitive duties on the import of Chinese electric cars. This is likely to make their purchase significantly more expensive for consumers – and it is even an opportunity for car manufacturer Magna in Graz.
The European Commission led by President Ursula von der Leyen was actually expected to make a decision on June 5. However, they waited for Sunday’s elections and announced on Wednesday: from July 4 – if talks with the Chinese side do not lead to an agreement – punitive tariffs will be levied on the import of Chinese electric cars.
And on different levels. The manufacturer BYD costs 17.4 percent, Geely (Polestar) 20 percent and SAIC even 38.1 percent. Until now, a uniform ten percent applies. The reason for this move is the high government subsidies for electric car companies in China, making the vehicles unmatched in price. In the US, even 100 percent punitive tariffs are imposed.
“Unusual and random”
German car expert Ferdinand Dudenhöffer assesses the different planned rates against the “Krone” as “very unusual and arbitrary”. He doubts they will hold up in court. Dudenhöffer is also unsure whether the tariffs will be introduced at all. All EU countries must first formally agree and would like to continue negotiations with the Chinese.
However, if the punitive tariffs actually come into effect, buying Chinese electric cars will become more expensive for customers in Austria. For the beleaguered car manufacturer Magna Steyr in Graz, however, it is actually an opportunity. Why? Chinese companies could increasingly produce directly in Europe to avoid high tariffs. BYD is already planning a factory in Hungary.
Chinese give Magna hope
The Magna factory in Graz is also interesting for the Chinese. “We are in constant contact with potential new customers,” it said when asked on Wednesday. Magna Steyr boss Roland Prettner told industry magazine Autoweek that Chinese manufacturers have been increasingly contacting Styria for more than a year to explore the possibilities.
Expert Dudenhöffer also sees a good opportunity for Magna, specialized in special series and smaller series of 50,000 to 100,000 vehicles: “For the Chinese manufacturers it could be an interim solution until their own factories are built – and for Magna a bridge until New command.”
Magna cuts staff
The Magna factory in Graz is currently going through difficult times. The Fisker project was a fiasco; only 10,000 vehicles were produced before the electric car company went bankrupt. Orders from Jaguar, BMW and Toyota are expiring. Only the Mercedes G continues to roll off the assembly line in large numbers as always. In April it was announced that 500 employees would be laid off. According to Magna, just over 7,000 people currently work at the site.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
