(Bloomberg) -- The UK government said it’s “concerned” about the impact of electric vehicle imports and considering potential action, after the European Union moved to impose provisional tariffs on EVs imported from China.
Business Secretary Jonathan Reynolds is “vigilant” about the issue and speaking to industry about next steps, Britain’s Department for Business and Trade said after a meeting with EU trade commissioner Valdis Dombrovskis at a G7 ministers’ meeting in Italy on Tuesday.
“Any solution would have to take the UK’s auto sector exports into account and be calibrated for the UK economy,” according to a government statement summarizing the talks.
The new UK administration is facing questions over whether it will follow the EU and US lead in raising duties on electric vehicles imported from China. The US has announced plans to impose a 102.5% levy, though shipments are currently close to zero, and Canada has said it’s weighing tariffs as well.
The EU’s move came after the bloc investigated what it said were unfair subsidies to EV makers in China, and after manufacturers like state-owned SAIC Motor Corp., which makes MG cars, and BYD Co. started to push more aggressively into Europe.
China’s EV makers are grappling with domestic overcapacity for both battery cell and auto production, and Europe is a lucrative export outlet for its manufacturers. Beijing has threatened to retaliate against EU tariffs, but both sides have signaled they’re ready to negotiate before the levies come into full force in November.
For the new UK Labour government — which has pledged to restore a deadline to phase out the sale of new combustion-engine cars as of 2030 — the challenge is to strike a balance between protecting a local industry that made more than a million cars last year and giving consumers access to competitively priced EVs.
For MG, the UK is the most important European market. Last year, the electric MG4 hatchback was the UK’s second-best selling EV after Tesla Inc.’s Model Y.
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