Mobility Portal, Spain
Date: May 23, 2024
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By Mobility Portal
United States

The U.S. takes the lead: Will increase tariffs on Chinese EVs by up to 100%

This measure will take effect in the U.S. from August 1st, when increases will also come into force for the purchase of batteries, microchips for the tech industry, and Chinese medical products.

The United States (U.S.) is set to raise tariffs on imports of Chinese electric vehicles (EVs) from 25 percent to 100 percent starting August 1, along with increased tariffs on batteries, microchips, and medical products.

The decision, announced by the U.S. Trade Representative’s office on Wednesday, also includes specific tariff increases for around 387 product categories, to be implemented gradually over the next two years.

These punitive trade measures, aimed at Beijing, target products where China seeks control in its production chain or sectors where United States has recently made significant investments.

President Joe Biden‘s administration will maintain tariffs set by his predecessor, Donald Trump, with further increases for the automotive industry and a doubling of tariffs on semiconductors to 50 percent.

The impact of these on trade between the world’s two largest economies could reach 18 billion dollars, affecting industries such as steel, minerals, and photovoltaic panels.

One of the hardest-hit sectors will be lithium-ion batteries, facing a potential 13.2 billion dollars impact on imports.

The tariff increases are set to begin on January 1, 2026, affecting trade valued at over 10.9 billion dollars.

U.S. Commerce Secretary Katherine Tai has defended these measures, citing China’s alleged theft of United States intellectual property.

However, Tai has recommended tariff exclusions for certain categories of industrial machinery imports from the Asian giant, including solar panel manufacturing equipment.

Further details on how companies can request exclusions will be provided later, with any exclusions granted effective from May 31, 2025.

In response, China is considering raising tariffs on imported vehicles, potentially to 25 percent for high-displacement cars.

The China Chamber of Commerce to the European Union has stated that such a move would have implications for EU car manufacturers.

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