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Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

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Biden To Hike Tariffs on Chinese EVs and Clean Energy Tech

  • Multiple reports in numerous outlets suggested this weekend that the White House will announce this week, possibly on Tuesday, quadrupled import tariffs on Chinese electric vehicles.
  • China warned that the heavy U.S. tariffs would backfire on America.
  • The U.S. Administration has signaled to the solar industry it could exempt some items from the hike in tariffs.
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The Biden Administration is preparing to announce major hikes in tariffs on Chinese clean energy technology and goods, including on electric vehicles, critical minerals, and batteries imported from China, aiming to protect American industry and jobs.   

Multiple reports in numerous outlets suggested this weekend that the White House will announce this week, possibly on Tuesday, quadrupled import tariffs on Chinese electric vehicles in another escalation of the trade spat between the world’s two biggest economies, each of which vies to win the clean energy race.

China vowed last week to defend its rights and warned that the heavy U.S. tariffs would backfire on America by raising costs for consumers.

At the end of last week, multiple outlets reported that the U.S. is set to unveil this week sweeping tariffs on Chinese EVs and other technology associated with the green energy transition. The Biden Administration will be looking to protect American manufacturing from China’s cheap products in the clean energy sector that have been flooding the U.S. and EU markets in recent years, undermining the efforts of the Western governments to reduce reliance on China in the clean energy supply chains. Related: Russia Targets Kharkiv in Major Offensive After Kyiv Attacks Refineries

The U.S. is now preparing to announce quadrupled tariffs on Chinese EVs – to about 100% from 25% now, The Wall Street Journal reported last week, quoting sources with knowledge of the matter. All Chinese vehicles imported into the U.S. are subject to an additional 2.5% import duty, which will effectively hike the tariffs on Chinese EVs imported in the U.S. to 102.5%.

Tariffs will also be imposed in other targeted industries, according to sources who spoke to Bloomberg.

The measures have been discussed for weeks, also in view of deciding which products could be spared from hiked tariffs so as not to stifle American clean energy growth, Bloomberg’s anonymous sources said.

The U.S. Administration has signaled to the solar industry it could exempt some items from the hike in tariffs, including machinery to make components for solar panels after American manufacturers argued they needed some imports and the current tariffs actually undermine the goal to onshore the U.S. solar supply chain. 

It was not immediately clear which items would be spared from the major tariff hikes. At any rate, there won’t be any reductions in the current tariff rates, two of Bloomberg’s sources said. 

Semiconductors and medical supplies, however, are likely to be hit with higher tariffs, sources familiar with the White House’s plan told Reuters on Friday.

Tariffs in other strategic sectors are also coming, according to multiple reports, after the United States Trade Representative (USTR) announced last month it was initiating an investigation of China’s acts, policies, and practices targeting the maritime, logistics, and shipbuilding sectors for dominance. USTR launched the investigation following a review of a petition filed by five U.S. national labor unions.

For EV tariffs specifically, the U.S. will target to address China’s “overcapacity” that could threaten American industry, as well as concerns about national security and the personal data of American consumers.

China vowed to defend its rights in response to the reports that it is being targeted in another wave of tariffs.

“We urge the US to follow WTO rules, lift all additional tariffs on China and not to impose new ones,” China’s Foreign Ministry Spokesperson Lin Jian said on Friday, commenting on the reports that significantly higher tariffs are coming for some Chinese goods.  

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“China will take all necessary measures to defend its rights and interests,” Lin added.

“Instead of ending those wrong practices, the US continues to politicize trade issues, abuse the so-called review process of Section 301 tariffs and plan tariff hikes. This will just double the US’s fault,” the Chinese official noted.

By Tsvetana Paraskova for Oilprice.com

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Leave a comment
  • George Doolittle on May 14 2024 said:
    Hurts US consumers big time. Long Garmin strong buy. Be interesting to see if GoPro makes a sudden move higher here. So much of made in China is still total junk I think the better approach is to label the product as "e-waste" instead of taxing based upon origin of product.

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