[UPDATE] Chinese EV Shares Jump Following EU’s New Import Tariffs

By Trisha Andrada

Jun 13, 2024 02:43 AM EDT

A BYD car is seen on a display stand on the first day of the British Motor Show at Farnborough International Exhibition Centre on August 17, 2023 in Farnborough, England. (Photo : Leon Neal/Getty Images)

The stock prices of most Chinese electric vehicle (EV) manufacturers jumped on Thursday morning, June 13, after the European Union announced additional tariffs of up to 38%.

Hong Kong's Index Rose 1.23%, Primarily Due to EV Company Gains

As the market opened in Hong Kong, the Hang Seng index (HSI) soared 1.23%, driven mostly by increases in EV companies.

In a report by CNBC, morning trading saw an 8% increase for EV manufacturer BYD, the HSI's biggest gainer. Nio and Li Auto, two competitors, had a 1.75% and 2.67% increase in share price, respectively, while Geely was up about 4%.

However, state-backed SAIC fell by almost 2%.

Vincent Sun, an equity analyst at Morningstar, noted that the EU's levies on Chinese EVs were modest compared to the 100% tariffs imposed by the United States.

READ NEXT: Volvo to Move EV Production to Belgium From China as EU Prepares to Impose Tariffs on Chinese EVs

EU Announces Up to 38% Tariffs on Chinese EVs

EU announced that large Chinese EV companies operating in Europe will face additional taxes effective July.

An additional 17.4% tariff will be levied on BYD, while Geely will get an additional 20% charge. The highest of the three new charges will be paid by SAIC, at 38.1%. This is in addition to the already-imposed normal tariff of 10% on imported EVs.

Samples from all three manufacturers were taken as part of the current EU investigation, as reported by Reuters in January.

Additional taxes of 21% would be imposed on other Chinese EV enterprises that participated in the probe but were not sampled, while additional levies of 38.1% would be imposed on those firms that refused to comply, according to the commission.

The EU inquiry last October prompted the extra taxes. In a statement, the commission provisionally found that Chinese EV producers profit from improper subsidization, which threatens the EU's EV sector economic harm.

The commission said that the penalties would be implemented on July 4 if talks with Chinese officials fail. They said final measures will be put in place within four months after temporary taxes are imposed.

READ MORE: Surge of Chinese EVs in Australia Sparks Dumping Concerns, Up to 50 Brands Expected by 2030

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