European Union slashes planned tariffs on China-made Tesla EVs، other Chinese firms

The European Union on Tuesday said planned tariffs onTeslavehicles being imported from China would be cut to 9% from 20.8%،while also reducing a number of planned import duties on other electric vehicle firms.

In June، the EU said it would slap higher tariffs on Chinese electric vehicle imports، which it found benefit “heavily from unfair subsidies” and pose a “threat of economic injury” to EV producers in Europe.

The European Commission، the executive arm of the EU، announced a preliminary conclusion that the battery-electric vehicles value chain in China “benefits from unfair subsidisation” and pronounced that it is in the EU’s interest to impose “provisional countervailing duties” on BEV imports from China.

The EU Commission disclosed on Tuesday its draft decision to “imposedefinitive countervailing duties on imports of battery electric vehicles (BEVs) from China.”

The planned tariffs

The regulatory body said that after receiving comments from interested parties on its planned tariffs، it would make a “slightadjustment of the proposed duty ratesbased on substantiated comments on the provisional measures.”

Electric vehicles made by Tesla in China will now face duties of 9% on imports to the EU. That is down from an anticipated rate of 20.8%، which the EU signposted in an earlier decision in July.

Tesla shares rose more than 1% in U.S. morning trading following the EU’s draft decision.

The EU said it made the decision to grant Tesla its own lowered individual duty rateas an exporter from China.

It comes afterElon Musk’s electric vehicle maker made a “substantiated request” to the EU that planned tariffs on its China-made EVs be recalculated to reflect specific subsidies the company receives in China.

Tesla was not immediately available for comment when contacted by CNBC on Tuesday.

BYD، theWarren Buffett-backed EV firm، saw its tariff rate reduced from 17.4% to 17%; Geely from 19.9% to 19.3%، SAIC from 37.6% to 36.3%. BYD، Geely and SAIC did not immediately respond to a request for comment outside of working hours in China.

Other companies cooperating with the EU in its investigation into China’s heavy subsidization of EVs، will face tariffs of 21.3%، the commission said. This is higher than the 20.8% rate cooperating companies would have faced under the EU’s previous July decision.

For those not cooperating، they will be slapped with 36.3% import duties. That is down from 37.6% previously.