· 2 min read
illuminem summarises for you the essential news of the day. Read the full piece on the Wall Street Journal or enjoy below:
🗞️ Driving the news: The U.S. and Europe are diverging in their responses to the rise of Chinese electric vehicles (EVs)
• The U.S. has imposed heavy tariffs and launched security investigations to block Chinese EVs, while the European Union is implementing more modest tariffs aimed at slowing their market entry
🔭 The context: The Biden administration has raised tariffs on Chinese EVs to 102.5%, and Canada may follow suit
• The EU's additional 17.4% tariff on Chinese market leader BYD is intended to reduce their cost advantage without halting their growth
• These moves come amid negotiations and counter-tariffs, such as China's antidumping probe into EU pork imports
🌍 Why it matters for the planet: The differing strategies highlight the geopolitical complexities in the transition to green energy and EV adoption, potentially affecting global supply chains and market dynamics
• Increased local production in Europe could reduce transportation emissions, but overcapacity remains a concern
⏭️ What's next: EU tariffs may accelerate local EV production, leading to joint ventures like Stellantis partnering with Zhejiang Leapmotor Technology
• In the U.S., the Inflation Reduction Act aims to establish a new EV supply chain, but maintaining separate supply chains could lead to inefficiencies and low returns
💬 One quote: "The elaborate combination of carrots and sticks... will create a whole new EV supply chain to run alongside the Chinese one that dominates today’s industry," Stephen Wilmot, WSJ
📈 One stat: Eight planned Chinese EV factories in Europe could mitigate the impact of EU tariffs
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