(AOF) – “Customs duties imposed by the European Commission on imported Chinese electric vehicles (EVs) are not expected to significantly affect the competitive landscape in Europe in the short term, given the slowdown in EV adoption” . This is what Fitch Ratings says, highlighting that imports of Chinese vehicles into Europe, including those manufactured in China by Volvo, Polestar and Renault’s Dacia, represented less than 4% of EV sales in 2023, compared to a third for You’re here.
The rating agency still estimates that the market share of Chinese local EV brands in Europe “will remain below 5% in the coming years.”
If China takes retaliatory measures, German automakers would be the most affected, Fitch adds, judging that “their current room for maneuver will allow them to absorb these pressures without their rating being affected.”
Exports to China represent “on average 10% of German car manufacturers’ unit sales, mainly of high-margin luxury models”: buyers in these segments “tend to be less price sensitive” and it will be possible to pass on additional customs duties on customers.
However, China also accounts for 20-30% of German automakers’ sales through joint ventures with Chinese manufacturers (bringing German automakers’ overall sales exposure to China to 30-40%). “Cash flow generation from these joint ventures will be challenged if trade tensions escalate,” Fitch forecasts.