Photo © Copyright Walter Baxter

ACEA sounds alarm over cost of imminent UK-EU tariffs on EVs

The European Automobile Manufacturers’ Association (ACEA) has urged the European Commission to “act immediately" to prevent tariffs being imposed on electric vehicles traded between the EU and the UK from January 2024.

You can read this article in 2 minutes

A a 10% tariff is due to be placed on EU electric vehicle exports to the UK.  This, argues the ACEA, could cost EU vehicle makers €4.3 billion over the next three years, and potentially reduce electric vehicle production by some 480,000 units.

Moreover, the ACEA adds that under the more restrictive ‘rules of origin’ rules due to apply from January, the only way to avoid these duties shall be to source all battery parts and some critical battery material in the EU/UK.

According to the ACEA, “this is practically impossible to achieve today”.

Commenting on the situation, Luca de Meo, ACEA President and CEO of Renault Group, said:

“Driving up consumer prices of European electric vehicles, at the very time when we need to fight for market share in the face of fierce international competition, is not the right move – neither from a business nor an environmental perspective. We will effectively be handing a chunk of the market to global manufacturers. Europe should be supporting its industry in the net-zero transition as other regions do – not hindering it. There is a very simple and straightforward solution: extend the current phase-in period for battery rules by three years. We urge the Commission to do the right thing.”

Finally, the ACEA claims that although massive investments are being made in European battery supply chains, more time is needed to build up the kind of scale needed to meet the rules of origin.


Photo © Copyright Walter Baxter and licensed for reuse under this Creative Commons Licence