Beijing asks car manufacturers to stop expanding in Europe

There is no doubt that China has a leading edge in the global electric vehicle market. However, according to reports, Beijing is ordering companies to halt their active pursuit of manufacturing sites in the area, sign new agreements and generally maintain a low level of activity while electric vehicle discussions are ongoing.

According to sourceswho asked not to be named because the discussions are confidential, state-owned Dongfeng Motor Group has already put an end to plans to possibly produce cars in Italy in response to the warnings.

While not a hard and fast rule, China’s instruction could worsen tensions as the two powers battle for control of the auto sector. Earlier this month, the European Union voted to increase tariffs on electric vehicles (EV) made in China to 45%, with Beijing wrongly claiming subsidies to its carmakers. China has vehemently disputed this claim and has now vowed to impose its own tariffs on Europe’s dairy, cognac, pork and car industries.

According to one of the sources, Beijing is also concerned about possible overcapacity due to the difficult EV transition in Europe and low demand for Chinese cars in the market, even as Dongfeng Motor told Italian officials that Rome’s support for the EU rates was the reason for his change.
This tension increased when customs taxes levied by the European Union increased significantly.
So it can be said that there are major tensions between the European Union and the Chinese electric car industry.