Chinese electric cars soon to be more expensive…

THE price of the electric cars remains one of the greatest brakes to their wide distribution. Of course, electric cars are being announced less expensive, around 25,000 then 20,000 euros. But these vehicles will also be smaller and not necessarily suitable for all uses, particularly families.

So far, the only affordable brands in electric cars are Chineseofficially, because the country which has been pushing electric cars for several years already fully controls the value chain (ore, processing, batteries, motors, electronics, etc.). What is true. That said, theexcellence of Chinese industrial process does not explain everything and not completely slashed prices which characterize Chinese electric vehicles. Recently, Europe also wanted to be clear about it and Commission launched a investigation to find out why these prices were so low. And the answer was not pleasant to discover: because Beijing subsidized its own manufacturers so that they are able to maintain ultra-compressed prices on foreign markets.

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Towards a rise in prices?

This situation will clearly lead to measures from Europe in order to sanction this unfair competition vis-à-vis its manufacturers who are obviously not financially supported. In this context, Europe is seriously considering raising special customs duties vis-à-vis Chinese electric cars.

The key is to know how much this tax could rise to. The first analyzes seem to give a competitive advantage to Chinese cars 20%. We can therefore imagine that the taxation of customs services could correspond to this percentage. Unless it is no longer like the UNITED STATES where cars from the Middle Kingdom are hit with an import tax of 27.5%.


Not that easy

That said, we will have to see how Europe views things. THE case East complex. Because taxing Chinese imported cars would therefore also mean raising a tax on the cars of the European manufacturers (or Westerners) who are built in China and then transported and sold to us (like the Dacia Spring for example, certain Teslas or the BMW iX3). Often, moreover, these models re-imported here are produced within a joint venture with a Chinese brand.

And we will finally have to see what will be planned for the future Chinese cars will be built on European soil. BYD, for example, announced the construction of a factory in Hungary. We assume that these cars will escape customs taxas was the case in its time with Japanese manufacturers once they established themselves on the old continent (Toyota, Nissan, etc.).


Less pressure on prices

In this context, the price war which is currently being carried out could therefore to slow down. Put less under pressureTHE walk could therefore see the prices of electric cars stagnate or even slightly re-increase if by chance, Europe also decided to tax detached pieces Chinese companies which are largely imported (components, battery cells, etc.) to build European electric cars.

The rest of the story will depend on what Europe decides. Or the manufacturers themselves who must make their investments in electrical technologies profitable. Given the overall slowdown in sales of electric cars all over the world – but not in Belgium due to the advantageous taxation for company cars – it is not impossible that the pressure on prices will continue simply to keep the factories running and reduce the loss of profitability. The future therefore remains very uncertainespecially since Europe could also give up.

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