The European Union has officially voted to impose tariffs on battery electric vehicles (BEVs) imported from China, marking a significant move in the ongoing trade tensions between the two economic powerhouses. Twelve member states abstained from voting, five opposed, and 10 supported Chinese EV tariffs.

The proposal will enforce countervailing duties on Chinese-made electric vehicles, which are believed to benefit from “unfair subsidies” that threaten European car manufacturers.

“The European Commission’s proposal to impose definitive countervailing duties on imports of battery electric vehicles (BEVs) from China has obtained the necessary support from EU Member States for the adoption of tariffs,” said the EU in a statement.

Ursula von der Leyen, President of the European Commission, stated, “Wherever we find evidence that their efforts are being impeded by market distortions and unfair competition, we will act decisively. And we will do this in full respect of our EU and international obligations.”

Initially proposed in June, the tariffs aim to protect European electric vehicle producers from what the EU describes as economic injury caused by subsidized Chinese imports.

Provisional duties, introduced in July, have now been revised based on feedback from stakeholders and will soon become permanent, as indicated by the EU’s final decision.

Meanwhile, the EU noted it was pursuing “an alternative solution” in China despite implementing the tariffs.

Chinese Chamber and European automakers urge the EU to reconsider the tariffs

The Chinese Chamber of Commerce to the EU expressed “deep disappointment” with the vote, labeling the EU’s actions as politically motivated and unjustified.

The chamber called on the EU to delay the implementation of the tariffs and to seek a negotiated solution instead. Chinese officials fear that the tariffs will impact both Chinese companies and international businesses that produce electric vehicles in China.

Within Europe, electric vehicle manufacturers also voiced their concerns about the new tariffs.

Germany’s Mercedes-Benz called them a “mistake,” warning of potential far-reaching consequences, while BMW said the decision could send a “fatal sign” to the European auto industry.

Meanwhile, Volkswagen argued that tariffs would not improve the competitiveness of European carmakers and urged both the EU and China to resume talks.

Volvo Cars, owned by China’s Geely Holdings, stressed its commitment to manufacturing in Europe. It will continue its strategy of building its cars locally despite the challenges posed by the new tariffs.

EU divided over fears of a trade war with China

The tariffs are set to take effect later this month, and EU members remain divided on the issue.

France, which had initially pushed for imposing the tariffs, supports the move, while Germany has expressed reservations, concerned about possible retaliation from China.

Chinese officials have already launched anti-dumping investigations into European goods such as pork and dairy products, further raising fears of a potential trade war.

German Finance Minister Christian Lindner urged the European Commission to avoid escalating the situation. He called for finding a middle ground to prevent a full-blown trade conflict between the two regions.

“We need a negotiated solution,” Lindner said on social media.