FRANKFURT (dpa-AFX) - A new European Union guideline for importing electric vehicles from China weighed on German auto stocks on Monday. In the DAX, Volkswagen was the biggest loser, dropping 1.3 percent. BMW shed around one percent, while shares in Porsche Holding fell 0.9 percent. Mercedes-Benz was only slightly in the red. In the MDAX, shares of Porsche AG slumped by 2.1 percent.
At the start of the week, the EU Commission outlined a path for Chinese carmakers to avoid the additional tariffs introduced in 2024. According to the new guideline, companies can commit to setting minimum prices for vehicles exported to the European Union in order to bypass the price surcharges. Furthermore, pledges to invest in the EU or limit exports would also be positively considered if such offers are made.
From the perspective of Citigroup analyst Harald Hendrikse, this represents another major victory for Chinese manufacturers. While the agreement could help BMW and Volkswagen ship their China-produced cars to the EU at lower costs, it is likely to intensify competition in Europe from Chinese brands. Less competitive European production capacities would continue to lose value.
The new guideline, Hendrikse added, cannot help Europe's carmakers in the Chinese market. It is inevitable that European manufacturers will continue to lose market share there. However, the exact consequences for the domestic industry will only become clear once the actual minimum prices are set.
The EU Commission said in the guideline that it intends to assess relevant price proposals from Chinese carmakers objectively and fairly. Acceptance requires that the measures eliminate the damaging effects of subsidies and have an effect equivalent to the tariffs. The Ministry of Commerce in Beijing welcomed the progress achieved.
The background to the additional EU duties introduced in 2024 was an investigation by the EU Commission, which concluded that manufacturers in China benefit from unfair subsidies that give them a significant advantage in the European market. Since then, the additional tariffs have ranged from 7.8 to 35.3 percent, depending on the manufacturer. Foreign companies operating in China, such as BMW and Mercedes, are also affected./niw/men
