Europe reduces 11% import duty on Tesla for China produced EVs

Europe will cut up to 11% import duty on Tesla electric vehicles coming from China, which is a big relief from rates decided July.

The latest development follows the European Union’s decision to put high import rates on Chinese-originated EVs. Its anti-subsidy investigation has found that Chinese EV makers are taking benefits from Chinese subsidies to sell their vehicles at lower prices in the region.

European Commission President Ursula Von Der Leyen said that the EU’s new import duties range from 17.4% to 37.6% to stop the threatened flood of cheap, state-subsidized EVs.

BYD was tagged with 17.4%, 19.% for Geely, and 37.6% import duty for SAIC motors. The companies that cooperated in the investigation but were not sampled are subjected to 20.8% import duty on average.

However, it has also drawn some problems for US EV makers such as Tesla, which produces high numbers of Model 3s in China and imports them directly to Europe. This has led to similar tariffs for Tesla, which sums about 20.8%.

Subsequently, the EV maker announced an increase in prices for Model 3 by up to 2.500 euros on each variant. At the same time, Valdis Dombrovskis, an EU commission said that Tesla could receive a special exemption from this high rate after an individual review.

The fresh announcement on Tuesday confirms that the company will have to pay 9% duties down from 20.8% decided in July. That’s an 11% import tariff reduction for the EV firm. Tesla shares jumped more than 1 percent in the US in the morning trading.

The commission has added that it has processed Tesla’s situation after an individual application process. It was based on specific subsidies the company receives in China.

Meanwhile, the EU has slightly changed duties on Chinese manufacturers including:

1. BYD 17% (down from 17.4%)
2. Geely 19.3% (down from 19.6%)
3. SAIC 37.3% (down from 36.6%)

However, the rates are unchanged for companies not cooperating on the investigation.

(via – CNBC)