Germany urges compromise in EU-China EV dispute

Germany urges compromise in EU-China EV dispute

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By: AFP
, updated on: 02 November 2024, 10:02 am

  • The German automotive sector condemned the recent tariffs, calling them harmful to business and employment.
Germany voted against the additional tariffs and has urged both Beijing and Brussels to find a compromise. (AFP)

The German government on Wednesday urged the EU and China to reach a compromise, a day after Brussels announced additional tariffs on Chinese-made electric cars.

“Both Brussels and Beijing are being urged to find sustainable and creative solutions through ongoing dialogue,” said Stefan Habestreit, a spokesman for Chancellor Olaf Scholz, in Europe's biggest economy, whose key auto industry is beset by problems. .

Germany voted against additional tariffs, measures which Habestreit said would “naturally draw a reaction from the Chinese side”.

Also read: Chinese EV makers see decline in EU sales as tariff dispute deepens

“These kinds of trade disputes are not something we should even aspire to,” he told a news conference.

New tariffs of up to 35 percent were announced by the European Commission on Tuesday after an EU investigation found that Chinese state subsidies were undermining European automakers.

Beijing said on Wednesday it had filed a complaint with the World Trade Organization, with China's commerce ministry vowing to “take all necessary measures to firmly protect the legitimate rights and interests of Chinese companies.”

Negotiations are ongoing between the EU and China and the tariffs could be lifted if both sides reach a satisfactory agreement.

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On Tuesday, Germany's Automotive Industry Association, which represents car giants such as Volkswagen, BMW and Mercedes, called the tariffs “a step backward for free global trade and thus a step back for prosperity, job protection and growth in Europe.” told.

Volkswagen warned on Wednesday that “painful” cuts were on the way as it announced a fall in third-quarter profits due to falling sales in China, its biggest market.

At least three German VW plants are at risk and thousands of jobs at the namesake brand could be lost, labor representatives said this week.

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First publication date: 02 November 2024, 10:02 am IST

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Trump claims Chinese automakers are building factories in Mexico, promises 200% tariffs

Trump claims Chinese automakers are building factories in Mexico, promises 200% tariffs

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By: AP
, updated on: Sep 18, 2024, 08:57 am

Trump made false claims about Chinese auto factories in Mexico, threatening to impose heavy tariffs on vehicles. He warned that a Harris win would devastate the economy

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Donald Trump is not a fan of electric vehicles, nor is he interested in subsidies for these. He is running for President of the United States again and has expressed his views on EV subsidies on several occasions. (Reuters)

Former President Donald Trump on Tuesday repeated false claims that Chinese automakers are building huge factories in Mexico. During a stop in the automobile state of Michigan, he vowed to impose a 200 percent tariff on all vehicles built in these unbuilt plants and shipped to the United States.

Trump also claimed during an event in Flint that if Democratic Vice President Kamala Harris is elected in November, there will be no auto industry in the US because electric vehicle manufacturing will move to China.

The statement comes at a time when employment in the automobile sector has grown since President Joe Biden took office in January 2021, after declining during Trump's first term.

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“If I don't win, within two to three years you're going to have no auto industry,” Trump said, calling any growth under Biden and Harris temporary. “You're going to have no manufacturing plants. China is going to take them all over because of the electric car.”

He told the crowd that he would force foreign automakers to build factories in the U.S. by imposing tariffs on imported vehicles, saying it would be “like taking candy away from a baby.”

Foreign automakers already have several factories in the US, mostly in the southern states.

Auto jobs fell 0.8 percent during Trump’s tenure to a little over 949,000 in January 2021, when he left office, according to the Bureau of Labor Statistics. Since Biden took office that month, auto and parts jobs rose 13.6 percent in August to 1.07 million, so there’s no evidence the industry is disappearing. Auto sales rose 2.4 percent in the first half of this year.

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Trump said his tariffs would prevent Chinese vehicles made in Mexico from being sold in the United States, forcing automakers in China and elsewhere to set up factories in the United States.

“They're being owned and built by China in Mexico, and there are several being built there right now,” Trump said of the Chinese factories.

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Although some Chinese automakers aspire to sell in the U.S., industry analysts say no major Chinese-owned auto factories are under construction in Mexico, and only one small Chinese auto assembly factory is in operation there, run by a company called JAC that builds inexpensive vehicles from kits for sale in that country.

Trump also promised to impose tariffs on vehicles made in the U.S. if other countries impose taxes on vehicles made in the U.S. But tariffs often end up being levied on consumers in the country that assesses them.

The Harris campaign released a statement from Michigan Senator Gary Peters saying a second Trump term would kill auto jobs, “handing Michigan's global auto manufacturing leadership over to the Chinese government.” He said Harris has a plan to bring good-paying manufacturing jobs home “and ensure Michigan workers continue to lead the world in auto manufacturing.”

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First Publication Date: Sep 18, 2024, 08:57 AM IST

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