The EU to impose new tariffs on Chinese electric bikes

Chinese electric bikes

Chinese electric bikes are on a new obstacle course as they will face new demanding tariffs. In European streets, these products will be met with even stricter fees.

The European Union voted on Tuesday in favor of imposing new tariffs on Chinese electrical bikes. The measure seeks to stop cheap imports. European manufacturers assure that these bicycles benefit from unfair subsidies and are flooding the market.

The European Commission proposed to establish final tariffs ranging between 18.8 and 79.3 percent on all electric bikes imported from China.

Trade war on two wheels

Antidumping and anti-subsidy tariffs are the latest in a series of EU measures against Chinese exports. Overall, the tariffs will range from solar panels to steel. The initiative has sparked a strong response from Beijing.

Unlike the United States, the European Union did not launch a trade war against China. However, the region does share some concerns with the American nation regarding forced technology transfer and Chinese state subsidies.

Imports of Chinese electric bikes were already under the provisional tariffs established in July. The final tariffs are generally imposed for five years.

Taiwanese company Giant is one of the largest bicycle manufacturers worldwide, with facilities in China and the Netherlands. This corporation would be forced to pay tariffs of up to 24.8 percent.

The Commission discovered that exports of Chinese electric bikes to the European Union tripled since 2014 to September 2017. Its market share grew to 35 percent, while prices dropped by 11 percent.

A growing sector

The truth of the matter is that the use of e-bikes has spread across practically the entire territory.

While relatively low just a few years ago, the popularity of this vehicle has consolidated nowadays, as sales for this product have skyrocketed.

This way, the number of e-bikes sold in Europe is set to reach two million by the end of the year. The fact that their price has decreased has greatly favored this rise in sales.

Prior follow up on Chinese electric bikes

In October 2017, the European Commission started an antidumping investigation motivated by the claim presented by the European Bicycle Manufacturers Association. This group aaccountsfor over 25 percent of the block’s e-bike production.

In this statement, the association presented evidence of “dumping” and “significant prejudice” stemming from it “enough to justify an investigation.”

According to the EU official website, imports from China tripled, going from nearly 200,000 units in 2014 to approximately 700,000 units during the investigation. The market share of these imported products grew from 17 percent in 2014 to 25 percent in that period.

According to the European Bicycle Manufacturers Association (EBMA), exports of e-bikes increased at an exponential rate. If this continues, the European electric bike industry could be in danger.

One of the causes behind this phenomenon is the Chinese industry’s capacity. In 2016, it produced 51 million units, of which just 28 million went to the domestic market. Therefore, 23 million were available for export.

In comparison, European production barely reaches one million electric bikes. In any case, European manufacturers also stress that part of China’s competitive advantage stems from the subsidies this sector receives from its government.

China gets defensive

The Office of Research and Corrective Commercial Measures of China’s Ministry of Commerce argues that the investigation on the country’s e-bikes goes against consumer interests. It is also not in line with EU efforts to combat climate change.

Furthermore, it argues that the Chinese and European electric bike sectors are collaborating. This joint labor expands to fields such as technical solutions and support to the supply chain.

For more information, check Energía16

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