Transport Secretary threatens “robust” sanctions amid fears that low-cost models may flood Europe
The Transport Secretary said that Britain would use “robust” sanctions to stop China from flooding car markets with cheap electric vehicles.
Mark Harper warned on Thursday about the danger posed by Chinese companies pushing new low-cost models into Europe.
He cited the post-Brexit regime of trade remedies, which allows for tariffs to be levied on imports deemed unfairly advantageous, as a means to prevent Chinese EVs flooding Western markets.
The comments show that the ministers want to crackdown on EVs coming from the Far East.
The Government is expected to launch an investigation into the claims that Chinese EVs received significant state assistance, similar investigations are already underway in Europe and the US.
At the SMMT Connected Conference in London, Mr Harper stated: “First, I can understand why people are worried about this.
Cost and competitiveness are the two issues that I believe most people are concerned with.
“We have robust measures here in the United States, including a trade remedy regime that covers not only the auto industry, but also all other markets. We want to ensure fair international trade and avoid dumping and unfair subsidies.
“I think we have an excellent legal structure.” This is the structure which will ensure that there is a fair competition and a level playing ground.
Mr Harper stated that he wants as many manufacturers as possible in the market, but also added: “The most important thing is to have a fair and competitive environment.”
“I’m sure that if competition is fair, British producers are at the table. We can compete with anyone in the world, both on the domestic market and also when it comes to exporting technology worldwide.”
These remarks represent the first time a British minister has publicly acknowledged that Britain may resort to tariffs on imports of Chinese cars if it is found they have received large subsidies from the Chinese government.
According to a report by Washington’s Center for Strategic and International Studies, since 2009 China’s central and municipal governments have subventioned domestic EV businesses in the amount of $100bn.
The EU has launched an investigation into the claims, which may put pressure on the UK to take action if they find that Chinese brands received unfair advantages.
The US administration of President Joe Biden has labeled Chinese electric vehicles as a threat to national security, and has threatened to punish them with harsh restrictions.
The UK government has so far insisted that it has not launched its own investigation and that a similar move would be triggered only by a formal complaint made by car manufacturers.
Last month, it was reported that the Department for Business and Trade was in the process of preparing and evaluating various options.
Giorgia Mello, the Italian Prime Minister, is courting Chinese electric automaker Chery Automobiles in a war against national champion Stellantis.
The government of Ms Meloni has been in talks with China’s third largest carmaker, a state-owned company, to set up a European manufacturing plant, as the country strives to meet ambitious production goals.
Reuters reported that BYD, Great Wall Motor, and other Chinese manufacturers were also contacted about the project. Chery emerged as the frontrunner to open a factory.
Chery is a company that focuses on electric cars (EVs). It has indicated previously plans to build a factory in the UK within the next decade.
Italy aims to increase its annual vehicle production to 1.3 millions vehicles from 800,000. The government of Italy wants Stellantis to be the last remaining carmaker in Italy. has urged the group to increase its production from 750,000 vehicles to 1 million per year.
This has caused tensions between both sides. Ms Meloni, who attacked Stellantis earlier this year for selling a car as “an Italian jewel”, said that the vehicle must be manufactured in Italy.
Meloni loyalists are concerned that too much production of cars is being moved overseas. Stellantis, however, is owned by the Italian Agnelli family which founded Fiat.
Ms Meloni has criticised the company for abandoning its Italian roots in order to list shares on New York.
The government could reach its 1.3 million car target by luring Chery to Italy. Chery was asked for a comment.
Separately on Thursday, the industry warned that Britain was falling behind Europe and America in terms of driverless cars due to slow progress with regulation forcing start-ups abroad to deploy their technology.
Mike Hawes of the Society of Motor Manufacturers and Traders urged the MPs on Thursday to pass laws that would allow fully autonomous vehicles to be driven on the roads. He noted that other Western countries had already passed such laws.
In November 2018, the Automated Vehicles Bill, which was first proposed in 2018, was included in the King’s Speech. The bill is currently being debated in Parliament.