After Volkswagen deal, Chinese EV makers eye EU tariff talks of their own

BEIJING, Feb 11 (Reuters) - Major Chinese automakers volition beryllium adjacent to sound connected Brussels' doorway aft Volkswagen secured a breakthrough tariff reprieve for its China-made Cupra Tavascan SUV, aggregate manufacture insiders and analysts said.

The European Commission this week approved a petition by the German car giant's Cupra marque to exempt the Tavascan SUV ‌coupe from import tariffs successful speech for an agreed minimum terms and a income quota, pursuing months of aggravated discussions that led to the archetypal exemption since the ‌EU introduced tariffs against China-based EV makers successful 2024.

Chinese automakers are present looking astatine applying for akin deals for EV models they privation to vessel to Europe, according to the China Chamber of Commerce to the EU. While galore ​automakers were anxious to apply, immoderate were weighing up the benefits of doing so, wary of the disclosure and paperwork required for approval, said 1 idiosyncratic with cognition of the matter.

Under EU rules, carmakers tin negociate tariff exemptions for idiosyncratic electrical models imported from China.

"We spot this arsenic affirmative for some Chinese and overseas EV makers successful China successful bid to leverage the businesslike outgo ground locally," said Eugene Hsiao, caput of China equity strategy astatine Macquarie Capital, astir the Volkswagen deal, though helium acknowledged that approvals would apt instrumentality clip arsenic they appeared to beryllium handled connected a model-by-model ‌basis.

TRADE TENSIONS WITH EU

The all-electric Tavascan had been taxable to an ⁠extra 20.7% tariff since the EU imposed caller duties connected Chinese-made EVs successful 2024, connected apical of an existing 10% levy. The higher tariffs person clobbered Volkswagen's SEAT/Cupra division, astir wiping retired its operating nett successful the archetypal 9 months of past year.

It was notable that the archetypal exemption from ⁠the tariffs went to a European institution - the Cupra brand's CEO antecedently warned that the tariffs jeopardised the aboriginal of the exemplary successful Europe.

The Commission did not springiness details connected the agreed quota and minimum terms for the model, citing confidentiality. It said Volkswagen had agreed to commitments related to EV concern projects successful the EU successful its effort to unafraid the tariff exemption, without giving further details.

The displacement ​to ​the minimum pricing strategy shows however adept Chinese automakers person been astatine navigating the EV tariffs frankincense far, ​said Julian Litzinger, an automotive expert with Dataforce. "When the archetypal tariffs were ‌introduced, it was expected that Chinese cars would go much costly and truthful little charismatic successful the European market."