Eu Chamber of Commerce in China: China is considering raising tariffs on imported US and European cars

The European Union Chamber of Commerce in China said China may consider raising temporary tariffs on cars imported from the United States or the European Union to as much as 25%.

The European Union Chamber of Commerce in China said in a statement Tuesday that the potential move would have an impact on European and U.S. automakers. The move comes after the Biden administration raised tariffs on Chinese electric vehicles to 100 percent and the European Union is investigating what it says are unfair advantages for Chinese automakers due to government subsidies.

In its statement, the chamber cited an exclusive interview published Tuesday in the English-language edition of China's state-run Global Times.

Liu Bin, chief expert of the China Automotive Technology Research Center, said in an interview that according to World Trade Organization rules, China's temporary tariff rate on imported cars can be raised to a maximum of 25 percent, and any decision by China to adjust the tariff is in line with World Trade Organization rules and "fundamentally different from the protectionist behavior of some countries and regions."

Liu therefore suggested that the Chinese government adjust the tariff rate on imported gasoline cars and sport utility vehicles with engines larger than 2.5 liters, which is not only in line with WTO rules, but also conducive to optimizing resource allocation, balancing domestic and international markets, and strengthening the policy orientation of green and low-carbon development.

Chinese electric vehicles have attracted attention in the European Union and the United States because China controls much of the battery supply chain and produces more electric vehicles than anywhere else in the world. Chinese automakers are expanding overseas amid a price war and a slowing domestic economy, prompting accusations from the U.S. and other Western countries that China is exporting excess auto capacity and cybersecurity concerns about Chinese high-tech vehicles.

According to Reuters, in 2023, China imported 250,000 cars with engines larger than 2.5 liters, about 32 percent of all imported cars. By comparison, China exported 1.55 million electric vehicles last year, with about 638,000 going to Europe and 52,200 to North America, according to Chinese customs data.