TMTPost -- German auto behemoth BMW AG is taking steps to mitigate shocks from the European Union’s recent tariffs on electric vehicle (EV) imports from China.

Credit：BMW Mini

BMW has asked Brussels to recalculate individual tariff rate to lower such levies for imports of its China-made electric Mini to Europe, Reuters cited people familiar with the matter, adding that the full-electric Mini now face the highest duties under provisional EU regulation. BMW was reported to aim to cut the duty levels to 20.8%, down from 37.6% under the current plans that the European Commission unveiled last week. The abovementioned people revealed BMW expects the electric Mini will ultimately be subject to a lower tariff, and an official process for new market entrants to seek lower duties would only be made possible in the fall, once final duties have been set.

The European Commission announced last Thursday it imposed provisional countervailing duties of up to 37.6%, on top of the ordinary BEV import duty of 10%, on imports of battery electric vehicles (BEVs) from China. The executive arm of the EU concluded through an anti-subsidy investigation that the BEV value chain in China benefits from unfair subsidization, which is causing a threat of economic injury to EU BEV producers.

Specifically, the additional individual duties on three sampled Chinese EV makers, would be 17.4% for BYD, 19.9% for Geely and 37.6% for SAIC. That means the EU decided to levy a little bit less duties on Geely and SAIC-made EVs since its pre-disclosed proposed rates are 20% and 38.1%, respectively, while BYD, China’s largest EV manufacturer, faces the same tariff rate as EU’s original proposal disclosed on June 12.

According to a statement of the European Commission , other BEV producers in China, which cooperated in the investigation but have not been sampled, are subject to the 20.8% weighted average duty, marginally downgraded from the Commission’s original proposed 21%, while all other BEV producers in China that did not cooperate in the investigation face an extra duty of 37.6%, compared with the original proposed 38.1%.  

The European Commission suggested the long-term definitive duties will be effective no later than four months ago, if approved by EU countries. All the abovementioned provisional duties are applied for a maximum duration of four months starting from July 5. Within the four-month timeframe, a final decision must be taken on definitive duties, through a vote by EU Member States, and when adopted, this decision would make the duties definitive for a period of five years, the Commission said.

The commission said any company producing in China not selected in the final sample that wishes to have its particular situation investigated can ask for an accelerated review, just after imposition of definitive measures. The deadline for concluding such a review is 9 months since its request.

BMW’s electric Mini made in China was said to be poised to face the highest EV tariff of 38.1% under the EU’s provisional plans, righ after the European Commission pre-disclosed the plans last month. The reason that Mini will be hit most by the tariff is that a joint venture created by BMW and China’s Great Wall Motor Co., Ltd. failed to fulfil the EU’s survey to the level of detail required to be classed as a company cooperating with its anti-subsidy investigation, the source of Reuters said. The venture, with a mass production of about 35,000 euros (US$37,345), started late last year, right after the investigation launched, and its production is still at early stage.