1 min read

EU Tariffs Weigh on China's Electric Vehicle Exports, Causing 42% Value Plunge

Chinese electric vehicle (EV) exports plummeted in November, reaching their lowest point since July 2022, driven by a confluence of factors including new European Union tariffs, weakened demand in emerging markets, and intensifying price competition, according to the latest detailed customs data released by Chinese authorities.

The value of EV exports in November amounted to US$1.58 billion, marking a 42 percent year-on-year decline. This represents the sharpest drop since April 2022 when global supply chains were disrupted by the COVID-19 lockdown in Shanghai and the outbreak of war in Ukraine. Notably, the decline in export volume was significantly smaller at 19 percent, highlighting the significant role of falling prices in the overall value reduction.

Economist Liang Yan of Willamette University attributes the sharp decline primarily to the EU's implementation of tariffs on Chinese-made EVs at the end of October. The bloc has become a major market for Chinese EV manufacturers, accounting for approximately 25 percent of total export value.

The imposition of tariffs, ranging up to 45 percent, has had a substantial impact on Chinese EV exports to the EU, with November figures showing a 36 percent year-on-year drop in value and a 23 percent decline in volume.

Beyond the EU, exports to emerging markets also experienced significant contractions. Shipments to the Association of Southeast Asian Nations fell by 25 percent year-on-year, while those to Latin America plunged by 47 percent.

Despite these challenges, Liang Yan remains optimistic about the long-term prospects of China's EV industry.

"Domestic sales are going strong, and China’s electric vehicle makers are building supply chains in the EU, Southeast Asia and Latin America,” Liang Yan noted, suggesting that the industry is actively seeking to diversify its markets and mitigate its reliance on regions affected by protectionist policies and economic uncertainty.