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How China is taking revenge on Europe for investigating unfair competition - AutoReview.nl

The European Union's investigation into state aid to Chinese car manufacturers has caused bad blood among the Chinese. In retaliation for the investigation, the Chinese government has decided to restrict the export of crucial raw materials for electric cars.

Last month, the European Union, through European Commission President Ursula von der Leyen, announced an investigation into unfair competition by Chinese car manufacturers. According to Von der Leyen, the enormous Chinese state subsidies are unacceptable and distort the market in Europe.

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Chinese answer

After those statements we could of course wait for an 'appropriate' answer from Beijing. This has now arrived: the Chinese Ministry of Commerce has decided that the export of graphite to Europe, among others, will be severely limited. According to the ministry, this measure was taken to protect China's interests.

Graphite is one of the most important raw materials for batteries in electric cars and China is now the largest exporter of this raw material. The country is reportedly responsible for more than two-thirds of global graphite production.

Trade war

The Chinese measure seems to be the starting signal for a trade war between Europe and China. There have been calls in Europe for some time to curb unfair Chinese competition in the field of electric cars. This can be done, for example, by introducing import duties on EVs.

Alternative

These developments make it even more important for European car brands to find an alternative to the raw materials they have so far obtained from China. In this way, they become less dependent on Chinese exports and less vulnerable to export restrictions. For example, you could replace graphite in battery packs with silicon. To be continued ...


This post was last modified on October 24, 2023 2:07 pm

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