Joe Biden is expected to unveil new tariffs on Chinese EVs. Here's what that could mean for the sector.
AP Photo/Lucas Peltier
- Reports say the US government is set to impose new tariffs on key Chinese industries.
- That means Chinese EVs, as well as solar cells and batteries, could be hit with higher taxes.
- Fears are growing about a wave of cheap Chinese EVs upending the US market.
President Joe Biden is expected to take aim at China's electric-vehicle industry.
Citing people familiar with the matter, Bloomberg reported that the US government was set to impose new tariffs on a range of Chinese industries, including EVs.
Targeting key strategic sectors
Reuters reported that specific details about the value or categories of tariffs were limited but that the administration seemed to be focusing on strategic competitive and national-security areas.
EVs appear to be under the most scrutiny, but batteries and solar cells could also be targeted under the plan. All could face higher taxes, though reports say they won't be the broad hikes that Donald Trump has pledged.
The decision could come as early as next week, but Bloomberg reported that it could be delayed. It'd mark the latest salvo in the government's attempt to protect the stuttering US EV industry from a wave of cheap Chinese exports.
Intense competition
Chinese EV producers such as BYD have so far largely avoided the US market because of preexisting trade barriers, such as a 25% tariff on Chinese auto imports previously touted by President Donald Trump.
But fears are rising over whether this may be about to change, with Chinese automakers increasingly looking to export their vehicles abroad as competition back home gets more intense.
Reports that the auto giants MG, BYD, and Chery were planning to build factories in Mexico sparked alarm from US officials and politicians late last year, with lawmakers warning that the move could give Chinese car companies "a backdoor to the US market."
Relief for US firms
The expected decision to target China's EV exports would come as a relief to US EV companies.
Tesla CEO Elon Musk said earlier this year that Chinese EV firms would "demolish" their Western rivals if trade barriers weren't put in place.
The reported new tariffs don't go as far as those suggested by Trump, who has said he would introduce a tax of more than 60% on all Chinese imports if elected president in November.