The EU Commission President wants to investigate whether Europe should exclude Chinese electric vehicles from the market.
(Photo: Reuters)
Strasbourg The EU wants to take action against cheap Chinese electric cars. She has instructed her authority to start an investigation into market-distorting subsidies, said EU Commission chief Ursula von der Leyen on Wednesday during her speech on the state of Europe in the European Parliament.
The EU is interested in economic exchange with China, but at the same time is determined to defend itself against unfair trading practices.
Von der Leyen recalled the fate of the European solar industry, which was forced out of the market ten years ago by heavily subsidized Chinese competitors. This should not happen to the EU again.
“Global markets are now flooded with cheaper Chinese electric cars,” said the Commission chief. “And their price is kept artificially low by huge government subsidies. This distorts our market.” Europe is open to competition, but not to a “race to the bottom”.
In recent days, the French government in particular has urged the Commission to use new trade instruments to protect the European car industry.
German manufacturers fear trade war
Germany, whose car manufacturers are particularly challenged by growing Chinese competition, is more cautious: companies like BMW, Mercedes and VW are heavily dependent on the Chinese market and fear a trade war.
Von der Leyen emphasized that it was essential to maintain dialogue with China. There are issues on which we need to work together. At a planned EU-China summit this year, she will advocate reducing economic risks, but will not decouple. Derisking instead of decoupling – that is von der Leyen’s approach to China policy.
Actually, the speech on the state of Europe is an attempt to bring some shine to the staid politics of the EU. The model is the “State of the Union,” which the US President holds once a year in Washington.
Von der Leyen spoke for more than an hour – about climate change, the Green Deal, the Ukraine war, equal rights and artificial intelligence. But her announcement on China dominated all other topics.
The EU must not allow its companies to be undercut by competitors who receive enormous state subsidies.
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