European EV Tariffs Fail to Curb Chinese Carmakers' Advance, Shifting Production Locations Instead
The European Union's policy of layering additional duties of up to 35% on electric vehicles (EVs) assembled in China, on top of its standard 10% import duty, has not effectively curbed the advance of Chinese carmakers. While the share of Chinese-built EVs in the EU market fell from 22% in 2024 to 17% by Q1 2026, this decline was primarily due to Western brands, including European manufacturers and Tesla, moving their production out of China. Chinese carmakers, conversely, now account for over half of all Chinese-built EV imports into the EU, a near-inversion of the policy's original intent. Even with tariffs, cars built in China remain approximately 21% cheaper than comparable European EVs, indicating that the tariffs have narrowed the price gap but not closed it.
