From January 1, 2024, the European Union must introduce new customs duties of 10% on electric cars imported and exported from/to the United Kingdom. A measure that worries players in the British automobile industry. The government and representatives of English manufacturers hope for a postponement of the provision.
Among the post-Brexit measures voted by the European Union, there is one which particularly worries players in the British automobile industry: the introduction of customs duties of 10% on electric cars imported from Great Britain.
The EU must implement this controversial provision from January 1, 2024. Unsurprisingly, manufacturers across the Channel are determined to modify, postpone or even cancel the entry into force of this measure. “We remain optimistic that an agreement will be reached. The last thing you want to do is impose additional tariffs on vehicles that you encourage people to buy,” declared this Monday, September 19 Mike Hawes, director general of the British automobile lobby (SMMT).
As a reminder, this provision also provides grounds for exemption. Thus, it is necessary that at least “45% of the value of electric vehicle parts comes from the European Union or the United Kingdom”. However, as you may know, electric car batteries represent a significant part of the price of EVs, and today, they are mainly made in China.
Also read: Electric car – the ecological bonus is disappearing in the United Kingdom, soon to be the case in France?
Berlin and London call for postponement of customs duties
On the Old Continent, the measure is already controversial, particularly because of the importance of the British market for European car manufacturers. For good reason, these customs duties will have direct repercussions on the price of EVs sold on British soil or exported by English brands to Europe. As our colleagues at the Financial Times reported in September 2023, Berlin has decided to join London’s position in turn, also calling for a postponement of the application of this new tax. Still according to Mike Hawes, we will have to wait until the last moment to decide on the establishment of a new agreement, “like for Brexit, on Christmas Eve or something like that.”
As a reminder, on another front, the President of the European Commission Ursula von der Leyen has just opened an official investigation into Chinese public subsidies granted to electric cars. According to the official, Beijing would use this aid to maintain prices of Chinese EVs “artificially low”, which in its eyes would constitute unfair competition. Obviously, the response from the Chinese authorities was not long in coming: they denounced “blatant protectionist behavior” and call on the leader to “create a fair and non-discriminatory market environment”.
Source: Le Figaro