Hungary - June 21, 2024

Storyline:
Hungary opposes EU's proposal to raise tariffs on Chinese EVs

(Voice_over)

Chinese-made electric vehicles face a potential roadblock in Europe.

The EU claims tariffs would protect European car manufacturers from alleged unfair competition.

However, there is disagreement over whether this is the right path for the bloc.

(Sound_bite)

Peto Erno, President, Hungarian-Chinese Chamber of Commerce:

"Protectionism instead of cooperation is not the right way to go."

(Voice_over)

Starting in July, the EU's additional tariffs on some Chinese electric vehicle brands could reach up to 38.1%.

To avoid these additional duties, analysts say Chinese automakers could follow the lead of BYD, which is constructing its first European EV manufacturing plant in Hungary. However, this strategy is not straightforward.

(Sound_bite)

Peto Erno, President, Hungarian-Chinese Chamber of Commerce:

"According to the EU customs regulation, a product is EU made if the spare parts and components are at least 52% of the total value."

(Voice_over)

Chinese EV makers currently have an 8% share of the EU market, up from under 1% in 2019, and this could rise to 15% by next year.

Analysts say prices, typically 20% less than EU-manufactured models, have accelerated their market growth.

(Sound_bite)

Tibor Antaloczy, Founder and editor-in-chief of Villanyautosok:

"These kind of tariffs have never helped in the past to develop the industries that it is here to protect, so in my opinion, it’s just going to slow down the development of these European firms."

(Voice_over)

In 2023, China and the EU maintained their status as each other's second-largest trading partners, with a combined trade reaching $783 billion.

(Stand_up)

Pablo Gutierrez, Reporter:

"Hungary has criticized the EU tariffs on Chinese electric vehicles, advocating for cooperation and free competition instead. On July 1st, Hungary is set to take over the rotating presidency of the EU, at which point it plans to introduce a series of measures to promote EV adoption in Europe.”

(Voice_over)

Hungary's plan includes a new EU incentive program to boost electric vehicle adoption among consumers and new standards to enhance the competitiveness of European EV makers.

(Sound_bite)

Levente Horvath, Founding director of the Eurasia Center and Former Consul General of Hungary in Shanghai:

"During this presidency, maybe we can tell everyone that what is the main focus and main idea of the Hungarian government; we want connectivity, we want to throw away this kind of sanctioning policy."

(Voice_over)

Some experts say it's not too late for the EU to step on the brakes and avoid a full-trade conflict with China.