Tesla has initiated legal proceedings against the European Union over tariffs imposed on electric vehicle imports from China. The European Court of Justice confirmed the case, which was filed by Tesla’s Shanghai unit, on its website without additional details.
Tesla’s legal action follows similar claims made by Germany’s BMW and several Chinese automakers against the EU. In October, the EU implemented anti-subsidy tariffs of 7.8 percent on Tesla, while other Chinese electric vehicles faced tariffs as high as 35.3 percent, alongside a standard 10 percent import tariff for the automotive sector.
This case marks another point of contention between the EU and Tesla’s CEO Elon Musk, who has been critical of EU technology regulations and has shown support for Germany’s far-right Alternative for Germany party during elections.
According to the European Automobile Manufacturers Association, new registrations for Tesla vehicles in 2024 declined by 13 percent year-on-year to 242,945 units. Musk’s political involvement is thought to have influenced some customers’ decisions against purchasing a Tesla, though it may have also attracted others.
Around 300,000 electric cars sold in the EU last year, which is about a fifth of the total, were manufactured in China. A consultancy report indicated that Tesla represented 28 percent of all Chinese-made electric vehicles imported into the EU in 2023, making it the leading brand in this category.
An EU investigation revealed that other automakers benefited from favorable loans, land agreements, and supplier subsidies, with Tesla receiving the least amount of support, which resulted in it facing the lowest tariffs.
An EU trade spokesperson indicated readiness to engage in legal proceedings, emphasizing that the bloc operates as a rules-based entity. Tesla’s legal filing does not outline the specifics of its arguments, and the case will be processed in the EU’s General Court, with the possibility of appeal to the European Court of Justice, a procedure that could take approximately 18 months.
Tesla officials have stated they are revising their import strategies in response to the newly imposed EU tariffs. Currently, the company exports Model 3 electric vehicles from Shanghai to Europe while manufacturing the Model Y in its Berlin facility.
photo credit: www.ft.com
