EU countries set to greenlight tariffs on Chinese electric vehicles

Good morning.

Today, our trade correspondent explains the politics and the potential impact of this morning’s vote on proposed EU tariffs on Chinese electric vehicles, and Laura reports on the scramble by European governments to get their citizens out of Lebanon.

Have a great weekend.

Full throttle

It’s EV Day in Brussels as member states are expected to confirm tariffs on imports of Chinese electric cars, heightening a spat with its largest trading partner.

But researchers estimate the move will only boost sales of EU-made electric vehicles if the bloc sticks to strict emissions targets, writes Andy Bounds.

Context: Diplomats from the EU’s 27 member states vote this morning on a European Commission proposal for anti-subsidy tariffs of up to 35.3 per cent, on top of the existing 10 per cent tariffs. Discussions on the tariffs have been controversial, but to block them, 15 countries representing at least 65 per cent of the EU population would have to vote against.

Commission officials are confident of success. Germany has led the charge against the tariffs, saying they would rebound on its own manufacturers who sell many models in China.

German finance minister Christian Lindner has said Berlin must vote against the tariffs, but it’s unlikely the opposition, joined by Hungary, can muster enough support. Italy and France are in favour, and Spain is expected to abstain, which in effect counts as a yes vote.

Governments hope the tariffs, which will last up to five years, will give the EU industry breathing space to sell its own, more expensive cars — currently struggling to compete with China’s cheaper offerings.

Transport & Environment, an NGO, has forecast that this will only be effective if the EU sticks to limits for reducing carbon emissions next year. Many rightwing politicians and carmakers have lobbied to delay lower thresholds for average car emissions, which should force them to sell more EVs.

According to the NGO’s study published today, EVs manufactured in China should capture a quarter of the market this year, but that could decrease to 20 per cent in 2025 and 18 per cent in 2026 under the tariffs.

But if the EU delays the 2025 emissions targets, Chinese-made EVs could grow to 27 per cent of the market next year as EU producers focus on higher-profit sales of cars with combustion engines.

“Higher EV tariffs are right but only in tandem with the car CO₂ targets. They are part of a coherent industrial policy to boost electric car production in Europe,” said Julia Poliscanova, senior director of Transport & Environment.

“The EU risks having the worst of both worlds if it delays the 2025 CO₂ targets while limiting the affordable models imported from China.”

Chart du jour: It’s the economy, stupid

Rising prices and the cost of living are the main concern on Europeans’ minds as we enter the new legislature, according to a new Eurobarometer survey published yesterday.

To the rescue

European countries are stepping up efforts to evacuate their citizens from Lebanon as the crisis in the Middle East deepens, writes Laura Dubois.

Context: Israel has stepped up its assault on Lebanon, launching multiple air strikes on Beirut yesterday that killed at least nine people. The attacks come after Iran launched a 180-missile barrage on Israel on Tuesday night.

The US and the other G7 partners have urged Israel to limit its response to the Iranian attack in the hopes of preventing the conflict from spiralling further out of control. But as the fighting continues, some countries are now starting to repatriate their citizens.

At least 180 Belgian citizens will be repatriated from Lebanon today using either commercial flights or free seats in other countries’ aircraft, a spokesperson for the Belgian foreign ministry said. They added that the number could still rise, as 1,800 Belgians live in the country.

Two Spanish military planes yesterday carried several hundred people back to Spain, the defence and foreign ministries said.

Germany already began evacuating non-essential staff and diplomats’ families at the beginning of the week. On Wednesday, a second evacuation flight brought another 130 to safety, bringing the total to 241, according to a joint statement by the foreign and defence ministries.

Cyprus yesterday flew 38 of its citizens and 22 Greek citizens out of Beirut, the Cypriot foreign ministry wrote on X.

The Dutch government has scheduled repatriation flights for its citizens today and tomorrow, the defence ministry said.

France has not yet started evacuation proceedings, but pointed out that Middle East airlines were still operating commercial flights between Beirut and Paris, on which citizens could leave the country if they wished.

What to watch today

1. European Commission president Ursula von der Leyen hosts lunch for EU ambassadors.

2. French President Emmanuel Macron hosts the Democratic Republic of Congo’s President Félix Tshisekedi in Paris.

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