EU announces anti-subsidy probe into Chinese EVs

The EU Commission will launch an anti-subsidy investigation into Chinese electric vehicles (EVs) which are “flooding” the market.

“We have to be clear-eyed about the risks we face,” commission president Ursula von der Leyen told MEPs, who had gathered to listen to her annual address on Wednesday (13 September). “Chinese cars are distorting the market, their price kept artificially low by huge state subsidies.”

“Too often, our companies are excluded from foreign markets or are victims of predatory practices,” she added, arguing that EU companies are often undercut by competitors benefitting from huge state subsidies. “We have not forgotten how China’s unfair trade practices affected our solar industry.”

“Europe is open for competition. Not for a race to the bottom,” she warned, announcing that the commission is launching an anti-subsidy investigation into electric vehicles coming from China.

The French government has pushed for such a probe for months, and von der Leyen recently discussed Chinese trade practices with Chinese premier Li Qiang on the sidelines of the G20 summit in New Delhi last weekend.

Although Chinese EVs have yet some distance to cover before becoming dominant in the European market, overall Chinese car exports have more than quadrupled since 2021, surpassing Japan this year as world leader in EV car exports.

The amount of capital injected into the Chinese EV market is so copious, and the development of newer, more advanced models so swift, that obsolete electric cars are reportedly piling up in graveyards across China.