US trade representative sympathizes with EU concerns over surging Chinese EV imports

U.S. Trade Representative Katherine Tai expressed sympathy Thursday for European Union concerns about surging electric vehicle imports from China, saying the situation seemed to echo what has happened in the past in other important industrial sectors.

But she stopped short of encouraging the EU to take action against the imports or committing the United States to taking similar steps.

“The fact pattern that you’ve described in terms of a strategic, super-relevant industry growing out of China, creating concerns around whether or not the production and the trade is and will happen on a market-based basis, is something that we have been living with now for a couple of decades,” Tai said in an interview at POLITICO’s Global Tech Summit.

Tai was responding to a POLITICO report that the European Commission, at the urging of France, is discussing whether to launch an investigation that could allow Brussels to impose additional levies, known as anti-dumping and anti-subsidy duties, on electric vehicle imports from China, which have increased sharply in recent years.

Pressed on whether the United States might consider a similar action, Tai said she was going to resist answering that question. But “what I want to emphasize to you is, this is a real concern,” she added, referring to China’s nonmarket behavior.

She also noted that the United States and European Union are already working together on a steel and aluminum agreement to combat Chinese practices that distort trade and also fuel climate change because of the amount of the greenhouse gas emissions they produce.

“The U.S. and the EU are right now in the midst of negotiating a [steel and aluminum] framework that will allow us to use the power of the combined U.S.-EU market to create incentives for cleaner production going forward, but also market-based production,” she said.

Chad Bown, a senior fellow at the Peterson Institute for International Economics, said it’s not surprising that the EU would be considering imposing either anti-dumping or anti-subsidy duties against the surging imports of Chinese electric vehicles. But the United States imports virtually no cars from China, including electric vehicles, he said.

That has long been the case, but former President Donald Trump made the market situation even more difficult in 2018 when he slapped an additional 25 percent duty on Chinese autos and auto parts, as part of a broad tariff action he imposed on Beijing, Bown said.

Tai resisted being drawn into a debate over the merits of “de-risking” trade with China by imposing restrictions in some sensitive areas, versus a complete decoupling of all trade engagement.

“But from my perspective, if we’re talking about steel, aluminum, solar panels, critical minerals … we need more options [outside of China]. We need more choices. We need more supply chains,” she said.