The European Union finds evidence of unfair competition from Chinese brands

The European Union has found evidence that Chinese car manufacturers are receiving massive state aid that allows them to offer their electric cars at (too) low prices.

According to an investigative committee, there is unfair competition because Chinese brands can offer their electric vehicles cheaper than Western companies.

The European Union has evidence

They receive government support, among other things, in the form of “direct transfers”, as described in the European report. Brussels says it has sufficient evidence of this.

The EU has ordered that electric cars from China must now receive special approval. This measure allows any import tax to be introduced quickly.

Predictable reaction from China

China reacted predictably and criticized the European investigation. It is “protectionism that will seriously damage trade relations between China and the EU.”

German brands are not satisfied

BMW, Mercedes and Volkswagen are also dissatisfied with the investigation. They have major interests in China, have a relatively large and stable share of the car market and therefore have a lot to lose.

The French brands do it

The French brands Citroën, Peugeot and Renault support the research. Logical, because they play a marginal role in the Chinese market and will therefore suffer relatively little from reprisals.

Because if the EU imposes an import tax on electric cars from China, China will also do the same on electric cars from Europe. An eye for an eye, a tooth for a tooth. That’s exactly how it works.

BYD rejects allegations

BYD rejects the European Union’s allegations. “Our success is not due to subsidies,” said Michael Shu, CEO of BYD in Europe, “but to our unique technology and high efficiency.”

“We invested in this technology much earlier than our competitors,” Shu told a Financial Times journalist. According to him, the subsidies BYD receives are very limited.