The Strategist

EU: Investigation into electric cars may affect Western companies

09/27/2023 - 10:04

According to Valdis Dombrovskis, Executive Vice-President of the European Commission, the investigations are not just focused on Chinese brands.

Tesla and other Western companies who import electric vehicles from China may be impacted by Brussels' investigation into electric vehicle subsidies, said Valdis Dombrovskis, EC Executive Vice-President, according to the Financial Times.

In response to a question about whether Tesla or Geely, which is owned by Sweden's Volvo Cars, might be the focus of the inquiry, Dombrovskis stated that "strictly speaking, this [investigation] is not limited only to electric cars of Chinese brands, it could also be cars from other manufacturers if they receive subsidies." Tesla ships electric vehicles made, among other places, at a factory in Shanghai to Europe.

The EU is "open to competition" in the electric vehicle market, but "competition must be fair," Dombrovskis told the journal after visiting China and participating in the 10th session of the EU-China economic and trade dialogue.

Dombrovskis traveled to China after Brussels opened a probe into subsidies for inexpensive Chinese electric vehicles amid escalating tensions and trade imbalances with China. The EU-China trade gap increased from €145 billion in 2016 to almost €400 billion last year, according to the EC.