EU may lower China EV import tariffs for VW and BMW

The European Commission has signaled to Volkswagen and BMW that it may consider lowering tariffs on the two carmakers' imports of China-made EVs, two sources with knowledge of the matter said.

The Commission is willing to classify the two automakers as so-called cooperating companies, the sources said, making them eligible for a 20.8 percent tariff on their China-made models, down from a tariff of 37.6 percent under current plans.

BMW's China-made electric Mini and the Cupra Tavascan, built in Volkswagen Group's factory in Anhui, China, were not part of Brussels' sample analysis in the run-up to the tariff announcement, which means they were automatically subjected to the highest tariff level.

If agreed, it would be a first, early compromise by Brussels on tariffs that will hurt some of Europe's top automakers because they build cars in China and import them to the region.

The German car industry has also opposed the tariffs because it is worried about retaliation from China, where German automakers made a third of their revenue last year. U.S. carmaker Tesla has asked for its own tariff rate on Model 3 EVs exported to Europe from its Shanghai factory.

VW declined to comment. BMW was not immediately available for comment.

Brussels has until autumn to make a final decision on the tariffs, which are preliminary for now.

A spokesperson for the European Commission said it was analyzing a number of requests from companies that were not yet producing battery-electric cars in China during the investigation, and would make a final assessment later in the process.

"The parties concerned will be informed of the Commission's proposal and will have the opportunity to comment in advance of the publication of any definitive measures," the person added.