FRANKFURT (dpa-AFX) - According to Commerzbank (Coba), the threatened EU punitive tariffs on imported Chinese electric cars would hit German car manufacturers particularly hard - also because of the retaliatory measures threatened by China. "However, we consider an escalation into a full-scale trade war to be unlikely overall," emphasized Vincent Stamer in a study published on Wednesday.

The economist pointed out that German car manufacturers produce electric vehicles in China for re-import into Europe. With the imposition of EU punitive tariffs, which would be added to the regular tariff rate, this would "hardly be profitable without considerable price increases". In contrast, Chinese manufacturers "have such high profit margins that they can compensate for additional duties of up to 30 percent and continue to export their cars to Europe at a profit".

Stamer sees the retaliatory tariffs threatened by China as a further negative factor for Volkswagen, Mercedes-Benz and BMW. Due to the high volume of trade, cars would be their most likely target. Stamer pointed out that the world's second-largest economy is an important sales market for German car manufacturers. At 24 percent, the share of German car exports to China is comparatively high, whereas it is hardly significant for the French and Italian competitors.

According to Stamer, the impact of punitive tariffs and countermeasures in the automotive sector on inflation in the eurozone would be low if there is no escalation. "However, due to inflation in Europe and recovering economic growth in China, neither party has any incentive for a trade war at the moment." In addition, the volume at stake in this trade dispute is a relatively small proportion of the total trade volume between the two blocs./gl/tih/mis

Publication of the original study: 12/06/2024 / 12:49 / CEST

First disclosure of the original study: Date not specified in study / Time not specified in study / Time zone not specified in study