A visitor learns about an electric vehicle from an employee at the 2024 China Auto Show in Shanghai on August 8, 2024. Photo: Lu Ting/GT

The China Chamber of Commerce to the EU said on Tuesday that the EU's protectionist measures against Chinese electric vehicle (EV) makers have caused unease and uncertainty.

The chamber was responding to a Politico report alleging that Chinese EVs flooded the EU market ahead of the levying of the provisional tariffs by the EU.

According to the Politico report, EV registrations in the EU surged in June with more than 202,000 new EVs receiving their first number plates, compared to an average of 144,000 plates in April and May, citing the Schmidt Automotive Research data. 

The Politico report said Chinese EV automakers held 12.4 percent market share in Europe in June, up from 10.4 percent year-on-year, alleging "Chinese carmakers frantically put as many vehicles as possible onto container ships sailing to the EU."

"We believe that the reported surge in Chinese EV makers' market share in June, if consistent with other market data, may be attributed to the EU's provisional countervailing duties on imported Chinese EVs, which took effect in early July. This situation also highlighted the unease and uncertainty caused by the EU's protectionist measures," the CCCEU said in a statement sent to the Global Times.

Zhang Jian, a vice president at the China Institutes of Contemporary International Relations, told the Global Times on Wednesday that Chinese EV brands' increased market share in the EU is a natural process thanks to their rising international competitiveness.

Technological innovation, globally competitive industrial clusters, full-market competition and agile supply chains have made the Chinese NEV industry increasingly competitive in the international stage, according to Zhang.

According to China's General Administration of Customs, the country's exports of battery powered EVs to the EU plummeted to 27,180 units in June, marking a decline of over 30 percent compared to the same month last year. 

In the first half of 2024, exports totaled approximately 222,000 units, down from nearly 260,000 during the same period in 2023, reflecting a year-on-year decrease of 14.6 percent, it said.

The investigation's negative effects on trade, bilateral relations, and efforts to tackle global climate change are increasingly evident, the CCCEU statement said.
"Tariffs will backfire, and it is crucial for China and the EU to pursue a constructive resolution to the trade friction over electric vehicles, whether through bilateral or multilateral channels," it said, noting that both Chinese and European EV companies advocate cooperation, and hope that the EU's policy settings will become more conducive to free trade.

Currently, China and the EU have conducted over 10 rounds of consultation regarding the EU's anti-subsidy investigation into Chinese EV makers, it said.

China on Friday initiated dispute settlement proceedings against the EU's provisional anti-subsidy measures against Chinese EVs at the WTO to safeguard the interests of its EV industry's development and the global green transition, China's Ministry of Commerce said.

"The EU side is soberly aware that its anti-subsidy investigations into Chinese enterprises and provisional tariffs are purely politically-driven decisions that go against WTO rules," Zhang said.

The Chinese side hopes that the two sides could appropriately solve trade frictions through dialogue, especially that the EU should recognize that any escalation of trade disputes will cause severe loss for its own interests, Zhang said.

China's decision to challenge the EU at the WTO was widely expected. Chinese companies have consistently reported being met by unfair measures during the EU's anti-subsidy probe. In response, China's action at the WTO aims to protect the legitimate rights and interests of its companies, seek resolution of trade disputes, and uphold the principles of fair international trade, according to the CCCEU.

The EU remained China's second-largest trade partner in the first seven months of the year, with bilateral trade reversing a downward trend to grow by 0.4 percent year-on-year, underscoring the resilience and complementarity of the two economies, latest data from Chinese customs showed.

"Without impact from the EU's trade protectionism, EU companies should greatly profit from the China market, which will help them invest in the research and development of cutting-edge technologies in the EU so as to raise the bloc's competitiveness," Zhang said.

He warned that the EU economy will feel the brunt if it "decouples" from the vast Chinese market and its green economy transition will be impeded without the contribution of Chinese companies and Chinese technologies. "In the long run, the EU's competitiveness and its share of the global economy will continue to decrease, which may impact the EU's social stability," he said.