Europe Might Provide VW With a Tariff Exemption on Its Vehicles from China | Carscoops

      European officials are contemplating the possibility of removing the 20.7% tariff on the Cupra Tavascan EV.

      The SUV, which is manufactured in China, is currently subjected to this tariff on Chinese electric vehicles.

      Volkswagen is seeking an exemption through the use of import quotas and pricing regulations.

      Given the complexities of modern manufacturing and global supply chains, it has become increasingly challenging to determine what truly qualifies as a European car.

      Is a Mercedes built in America or a Volkswagen made in China genuinely German? This distinction is significant, particularly amid trade conflicts and tariffs. Nonetheless, Volkswagen is optimistic that its European background will provide an advantage.

      Earlier, VW's CEO warned that the Cupra could face severe consequences from EU tariffs.

      Reports from Reuters indicate that the European Commission has opted to reassess the tariffs imposed on Volkswagen Group vehicles manufactured in China. Instead of adhering to a conventional tariff, the automaker is reportedly considering an "import quota and minimum price mechanism."

      The request was submitted by Volkswagen Anhui, a joint venture with JAC that produces the Cupra Tavascan. The automaker has stated that the tariffs pose a "serious threat" to its operations.

      Should the Commission approve the request, the Tavascan could potentially be exempt from the 20.7% tariff. This decision might be made in a few months, although it is uncertain whether officials will be convinced by the company's reasoning.

      Even if the model receives a tariff exemption, the proposed minimum price may not prove advantageous. Officials have emphasized that any minimum prices would need to be as effective and enforceable as the tariffs.

      Automakers Encounter High Tariffs in Europe

      According to the South China Morning Post, car manufacturers face high tariffs when importing vehicles into Europe. The noted 20.7% tariff on Chinese electric vehicles is in addition to a 10% baseline tariff.

      Moreover, the tariff rates vary among manufacturers, with SAIC reportedly facing a 35.3% tariff, BYD a 17% tariff, and Geely an 18.8% tariff.