A specter is roaming the world - the specter of a new trade war. At stake is who will control the electric vehicle market - Western countries or China. And this is a market that is estimated at 1 trillion dollars by the end of 2023, according to the International Energy Agency (IEA).
Chinese electric cars
Over half of all new electric cars sold worldwide are made in China. Electric cars built in the Asian country are cheaper than those built by rival Chinese companies, Sky News said. ·
The business of the Chinese electric car manufacturer "Zeekr" (Zeekr), which makes luxury electric cars, is growing rapidly.
The company's plant in the Chinese port city of Ningbo has only been operating for three years, but this year it has more than doubled its production.
"Zeekr" is owned by the automotive concern "Geely" (Geely), which is developing its business with the support of the rulers in Beijing, points to "Sky News".
The company "Zeekr" is a new player in the electric vehicle market, but is ambitious to break out of its home country and sell its high-tech electric cars in the West.
And the Chinese manufacturer is already fulfilling this ambitious goal.
The electric cars of "Zeekr" are sold in Sweden and the Netherlands, and recently in Germany, as well as in a number of other European countries.
One of the company's models - "Zeekr 001", whose design is reminiscent of the "Porsche Panamera" (Porsche Panamera), has a range of 600 kilometers on a single charge of the battery, according to data from the Chinese automobile company.
The European headquarters of "Zeekr" is based in Gothenburg. The Chinese company has built a research center in the Swedish city. Its owner, the Geely concern, also owns the emblematic Swedish brand Volvo. (Volvo).
For his part, the head of "Geely" Li Shufu is one of the main shareholders in one of the most prestigious car companies in the world - the German concern "Mercedes-Benz". (Mercedes-Benz).
"Geely" is also a majority shareholder in the manufacturer of the iconic British sports cars "Lotus Cars" (Lotus Cars).
"Tesla" and the American giant
's Chinese competitors
At the beginning of January of this year, it was announced that the Chinese automobile company BWYD (abbreviated from Build Your Dreams or "Build your dreams" - ed.) had overtaken in the last quarter of 2023 the American giant " ;Tesla" (Tesla) by the number of electric cars sold.
BWD Corporation delivered 526,000 new all-electric vehicles (BEVs) to customers worldwide in the period October - December 2023, and "Tesla" - 484,507, the BBC recalls.
However, for the whole of 2023, the American electric car manufacturer is the record holder with 1.8 million electric cars sold worldwide.
"Tesla" however, it is once again forced to lower the prices of its electric cars in a number of leading markets, including China, global agencies reported last month.
The company's decision comes after it reported at the beginning of the month a serious drop in the number of electric cars it delivered in the first quarter of 2024. Their number decreased to 386,810 compared to the last quarter of 2023 (484,507).
On this background, the American company is lowering the starting price of its electric cars on the Chinese market by 14,000 yuan (about 1,933 dollars). Thus, the price of electric cars from the "Model Y" series hit their lowest level since being offered on the Chinese market - 249,900 yuan (about $34,506), according to CNN.
The West and Chinese Expansion
A number of Western leaders are watching China's expansion into the electric car market with concern. The European Union and the United States accuse the rulers in Beijing that through the state financial support they provide to private Chinese automobile companies, they get an "unfair advantage".
Representatives of the European Commission are investigating Chinese car companies that also operate in EU countries to determine whether they are not applying unfair trade practices. This was reported in January by Reuters, citing three sources who are connected to the investigation.
EU investigators are inspecting the representative offices of the Chinese automakers BWI, "Geely" and SAIC, two of the sources told Reuters.
The EC has confirmed that it has "launched an investigation into the commercial practices of car manufacturers".
The review, which began in October 2023, aims to find out whether the huge subsidies China gives to electric car makers are keeping prices artificially low. The aim is to determine whether this practice gives them an illegal advantage over their competitors in the EU, as well as whether the imposition of punitive duties on imports into the European Union of Chinese electric vehicles is necessary, according to Reuters.
"World markets are flooded with cheap Chinese electric cars". This was stated in September 2023 by EC President Ursula von der Leyen in her "State of the Union" speech. before the European Parliament in Strasbourg. According to her, the prices of Chinese electric cars are kept artificially low through state subsidies.
If this is proven, the European Commission may impose punitive tariffs on the import of Chinese electric cars into the EU countries, notes "Sky News"·
In April, German Chancellor Olaf Scholz visited China, accompanied by high-ranking managers of leading German companies.
Scholz visited a prestigious university in the Chinese metropolis of Shanghai, where he commented on the entry of Chinese electric car manufacturers into the market in Germany and other European countries.
"The only thing that must be clear from now on is that the competition must be fair, without dumping, without overproduction and with respect for copyright,", the German chancellor said.
For her part, US Treasury Secretary Janet Yellen, who visited Beijing last month, accused China of imposing dumping prices on the sale of electric cars in other countries.
Yellen pointed out that direct and indirect government support by Beijing's rulers "results in production capacity that far exceeds domestic demand as well as what the global market can bear.
When asked by CNBC whether Washington could impose punitive tariffs on imports of Chinese goods if Beijing continues to provide illegitimate state aid to its companies, Yellen replied: "I wouldn't rule anything out at this stage. We have to keep all options on the table. We want to work with the Chinese to see if we can find a solution.
"Zeekr": The world market is big enough for all producers
The vice president of the Chinese electric car manufacturer "Zeekr" Chen Yu told Sky News that when foreign companies built their first electric vehicle factories in China, local firms quickly learned from their know-how.
He says that along with other Chinese EV manufacturers, they have learned a lot from their Western competitors about the technical characteristics and design of the cars, as well as their corporate culture.
The possibility of the EU imposing punitive tariffs on imports of Chinese electric vehicles is a source of concern for the Vice President of the "Zeekr".
"Undoubtedly, we are worried about a possible challenge like this," Chen Yu points out.
Potential punitive tariffs and the introduction of other measures against Chinese electric vehicle manufacturers by Western countries, however, do not seem to bother the company "Zeekr" in general, notes "Sky News".
The division of the Chinese giant "Geely" does not consider the threat of punitive tariffs to be too serious.
The position of "Zeekr" is that the world market is big enough for all electric car manufacturers.
If so, only time will tell.