Published On: Fri, Sep 15th, 2023
World | 2,927 views

France and UK locked in electric car trade standoff over fears of Chinese market influx | World | News

France has painted the UK as a potential backdoor for cheap Chinese electric vehicles to flood the EU market amid a bid to block a British request to Brussels for a free trade deal on exporting electric cars.

The British Government has the support of car manufacturers across Europe for the bid to have Brexit trade tariffs put on hold to allow electric vehicles to be sent to the EU from the UK.

France is strongly opposed to the tariff delay insisting that British electric cars could become a means for Chinese manufacturers to enter the bloc’s internal market.

China is a main supplier for many electric car parts for instance Chinese batteries are needed by both Nissan and BMW who are heavily invested in the UK electric car market.

The UK is lobbying Brussels to pause the introduction of post-Brexit trade rules that are due to come into force at the end of the year and run until 2027.

Electric vehicles exported from the United Kingdom to the European Union must have 60 per cent of their battery and 45 per cent of its components by value originating in either the EU or the UK, according to the “rules of origin” requirements.

Electric vehicles traded between the UK and the EU that do not fulfil these criteria will incur a 10 per cent trade tariff beginning next year, despite the fact that the UK and Brussels have a zero-tariff, zero-quota trade agreement.

French ministers are urging the European Commission to stick to these tariff policies in order to minimise the bloc’s reliance on countries such as China and the United States.

A French source told The Telegraph: “The British want an extension to the deadline until 2027 to continue flooding the EU market with Chinese batteries and thus become a hub in the process,

“A European battle will now ensue. The French position is to say no to the British because it is a question of sovereignty as we want to create a European battery industry and flooding the French market with Chinese batteries would stop it from happening.”

According to a source familiar with the negotiations, British officials are disappointed by the slow progress they’ve made in their interactions with European counterparts.

They have expressed their displeasure, claiming that Brussels has ignored warnings made by both British and European car makers.

These warnings have emphasised that if the laws are not postponed, the industry will face severe financial consequences.

The French source added: “So far, no decision has been made. But the outcome will give an indication of how we envisage future relations with the British. We have no economic interest in extending the deadline.”

Despite the French opposition, British officials remain optimistic that the deadline will be extended beyond this year.

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