Navigating Turbulent Waters: Impact of EU Tariffs on Chinese Auto Brands and Strategic Responses

EU - China electric car

European Union (EU) has followed the United States in imposing high tariffs on Chinese electric vehicles, surpassing initial predictions. While the Rhodium Group foresaw tariffs possibly reaching 19%, the reality saw higher figures. Effective June 12, the EU added to existing 10% tariffs, with increases ranging significantly: BYD faced a 17% rise, Geely Auto 20%, and SAIC up to a staggering 48%. This move has sparked considerable controversy and criticism in European media, characterizing sentiments as distorted and potentially hateful.

EU Tariffs

Targeting SAIC: Investigative Overreach or Strategic Maneuver?

Speculation surrounds the focus on SAIC, particularly rumors of non-cooperation with EU investigations. Reports suggest probes extending beyond standard anti-subsidy inquiries, demanding sensitive technology details, including from joint ventures not exporting to Europe.

Traditionally, anti-subsidy tariffs are broad, aimed at national industrial policies rather than specific entities. Yet, this instance appears pointedly directed at SAIC, notable for its robust European performance and extensive patent holdings.

Impact on Chinese Brands and European Strategy

1. Accelerating Chinese Investment in Europe

The tariffs are expected to catalyze a shift towards “reverse joint ventures” between Chinese and European brands. Despite Germany’s reservations, the move led by France highlights divisions within the EU regarding Chinese automotive market access.

EU Tariffs

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2. Evolution of Overseas Expansion Models

Chinese automakers are transitioning from merely exporting to Europe (Overseas 1.0) to establishing robust supply chains within Europe (Overseas 2.0). Plans include setting up manufacturing facilities across key European countries, enhancing market integration and local responsiveness.

3. Strategic Responses and Joint Ventures

Recent collaborations like Leapmotor and Stellantis illustrate a growing trend towards joint ventures aimed at navigating tariff barriers and expanding market reach in Europe. Such partnerships may mitigate tariff impacts by localizing production and enhancing technological exchange.

Navigating Globalization’s “Transition Zones”

1. Conceptualizing the “Transition Zone”

Historically, regions like the “Miaojiang Corridor” exemplify pivotal points connecting diverse economic and cultural regions. In contemporary terms, these zones signify critical interconnections amid evolving global trade dynamics.

EU Tariffs

2. Emerging Corridors of Globalization

Countries such as Vietnam, Poland, Mexico, Morocco, and Indonesia are identified as potential corridors facilitating global supply chain interconnectivity. Notably, Morocco’s appeal stems from strategic geographic location, resource abundance, and stable political climate, attracting investments like Guoxuan High-tech’s battery plant.

3. Strategic Imperatives for Chinese Companies

In light of geopolitical tensions and supply chain disruptions, Chinese companies venturing abroad must adopt resilient strategies. Choosing corridors wisely for expansion ensures optimal resource utilization and minimizes operational risks amid global uncertainties.


Despite challenges posed by escalating tariffs, Chinese independent brands are poised to navigate these obstacles by deepening strategic alliances and leveraging global “transition zones”. The evolving landscape demands agile responses, ensuring sustainable growth and market resilience in an increasingly fragmented global economy.

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