EU expected to vote on higher China EV tariffs on Sept. 25

The European Union is aiming to hold a vote on introducing definitive tariffs on electric vehicles imported from China on Sept. 25, according to people familiar with the plan.

The vote would pave the way for the duties to kick in starting in November unless a qualified majority — 15 member states representing 65 percent of the EU's population — opposes the move. The date of the vote could still change, said the people, who spoke on the condition of anonymity.

The EU has proposed hitting SAIC Motor, Volvo parent Geely and BYD with duties of 36.3 percent, 19.3 percent and 17 percent, respectively, on top of the 10 percent tariff that exporters from China are already subject to.

Those rates are expected to be slightly revised downward, Bloomberg previously reported.

Tesla would face an additional rate of just below 8 percent, plus the base duty.

European Commission President Ursula von der Leyen launched the EV investigation last year, saying that Chinese companies unfairly benefit from state subsidies and are flooding Europe with excess production.

In response, Beijing launched anti-dumping investigations into EU exports of brandy, dairy and pork products.

China and the EU have been holding talks to explore alternatives to the tariffs but these haven't been fruitful so far. For Brussels, any solution has to be grounded in World Trade Organization rules and address the underlying harmful subsidies an EU probe identified.

Discussions will continue next week when Chinese Commerce Minister Wang Wentao visits Europe to meet with the EU's trade chief, Valdis Dombrovskis.

China claims the measures are protectionist and has threatened to retaliate with duties of its own on a range of sectors while seeking an agreement to solve all the disputes as a package.

Beijing is also challenging the measures at the WTO. The EU sees the Chinese investigations as retaliation and intends to defend its interests in all three probes, the people said.

Spanish Prime Minister Pedro Sanchez raised eyebrows earlier this week when he said the EU should re-examine its plan to impose the tariffs during a visit to China.

Germany has also been pushing Brussels to find an alternative to the duties, as its auto industry has voiced concerns about the measures.

Germany and Spain both have massive financial incentives to avoid a spiral of tit-for-tat restrictions. German automakers including Volkswagen Group and BMW Group would be hit hardest in a trade spat, as they collectively sold 4.6 million cars there in 2022.

Spain is the EU's second largest car-manufacturer and is seeking to attract investments from China to develop its EV industry — part of the reason behind Sanchez's trip there this week.