If any American secretly longs to own a Chinese electric vehicle, that hope may soon be dashed. President Joe Biden is reportedly preparing to impose nearly 100% tariffs on Chinese electric cars, according to a new report citing informed sources.
This marks a significant increase from the previous 25% tariff, virtually eliminating any chance for such vehicles to enter the U.S. market. However, there is one loophole to consider—Mexico.
The new tariff, first reported by The Wall Street Journal, is expected to be made official next week. It will apply not only to electric vehicles but also to batteries and solar panels coming from China. All of this comes at the end of a review that began in 2022. While some politicians, including former President Donald Trump, have pushed for a uniform increase in tariffs across the board, these increases are more significant. They closely align with President Biden’s recent statements regarding raising tariffs on Chinese steel.
Biden said, “For too long, the Chinese government has pumped state funds into Chinese steel companies, pushing them to produce as much steel as possible, underwritten by the Chinese government. They are not competing. They are cheating. We’ve seen the damage here in America.”
The report notes that Biden will also impose a 2.5% tariff on all cars imported to the United States.
It’s worth noting that these new tariffs do nothing to eliminate a significant loophole that China could use to bring electric vehicles into the United States. This loophole is Mexico, a country where some Chinese companies can manufacture their electric cars. If they do so, they can then avoid tariffs when bringing these vehicles to the U.S. market. Meanwhile, additional obstacles may prevent this market shift.
Last month, under pressure from the U.S., Mexico halted federal incentives for Chinese automakers to establish manufacturing plants in the country.
Yasir Al-Mansouri have more than 10 years of experience in the automotive journalism world. He is an expert of automotive news articles, features, and reviews on cars, from the latest models to industry trends. He've built strong relationships with car manufacturers and industry experts. Connect with Yasir Al-Mansouri on LinkedIn to stay updated on all things automotive and join our exciting journey in exploring the world of automobiles.
