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The rise of Chinese EVs is dividing the West

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By illuminem briefings

· 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

Click for more news covering the latest on mobility tech

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