People visit the booth of Chinese carmaker BYD during the 2023 International Motor Show, officially known as the IAA MOBILITY 2023, in Munich, Germany, Sept. 5, 2023. The IAA MOBILITY 2023, one of the world's largest mobility trade fairs, opened in the southern German city of Munich on Tuesday.(Photo: Xinhua)

China's Ministry of Commerce (MOFCOM) has expressed serious concern and strong opposition to the EU's investigation into Chinese electric vehicle (EV) makers over subsidies, calling the EU's behavior "blatant protectionism."

The investigative measures planned by the EU are actually aimed at protecting its own industry in the name of "fair competition." It is an act of blatant protectionism that will seriously disrupt and distort the global automotive supply chain, and have a negative impact on China-EU economic and trade ties, the MOFCOM said in a statement on Thursday.

China's Foreign Ministry made a similar comment on Thursday.

The comment came after European Commission President Ursula von der Leyen announced on Wednesday that the EU is launching a probe into Chinese EVs, claiming the prices of imported Chinese vehicles are being kept "artificially low by huge state subsidies." 

China urged the EU to engage in dialogue and consultation, considering the big picture of maintaining the stability of global industrial and supply chains and the China-EU comprehensive strategic partnership, so as to "create a fair, non-discriminatory and predictable market environment for the common development of the China-EU EV industry," the MOFCOM said.

It added that China will pay close attention to the EU's protectionist tendencies and follow-up actions, and firmly safeguard the legitimate rights and interests of Chinese firms.

Cui Dongshu, secretary-general of the CPCA, told the Global Times on Thursday that it was not the so-called enormous state subsidies that the EU claims built China into a leading force in the world arena. "It is because China's industrial chain has grown highly competitive under full market competition," Cui noted.

China's subsidies for the new-energy vehicle industry were completely phased out at the end of 2022 for the sound development of the sector.

"The EU should take an objective view of the development of China's EV industry, rather than arbitrarily using unilateral economic and trade tools to increase the operating costs of Chinese EV products in the continent," Cui noted, adding that the EU's planned move could hurt itself in green transformation.

In recent years, China's EV industry has seen rapid development thanks to its unremitting technological innovation and building up of a complete industrial chain and supply chain. The competitive advantage it has forged was achieved through hard work, which has been favored by consumers including those in the EU, while it has made great contributions to the global response to climate change and green transformation.

The Chinese and European automobile industries have extensive space for cooperation and common interests. After years of development, the two sides have a stake in each other's future, the MOFCOM said.

At this year's International Motor Show in Munich, Germany, more than 70 Chinese carmakers and suppliers showcased their products and services, having a strong presence in the international fair.

According to auto consultancy Inovev, 8 percent of new EVs sold in Europe so far this year were Chinese, up from 6 percent in 2022 and 4 percent in 2021. 

In 2022, the European market accounted for nearly half of China's total new-energy vehicle exports, data from the China Passenger Car Association (CPCA) showed.

Prior to the MOFCOM's response, the China Chamber of Commerce to the EU (CCCEU) on Wednesday expressed opposition to the EU's planned investigative measures.

"We strongly encourage the EU to treat the progress of China's EV industry with objectivity rather than resorting to unilateral trade measures that could obstruct the development and ramp up operational costs of Chinese EVs within the European market," according to a statement issued by the CCCEU.

Global Times