Currently reading: Stellantis CEO: Chinese cars must be charged import tariffs

Carlos Tavares says European EVs must be cheaper than Chinese alternatives in order for car makers to survive

Chinese car makers must be charged import tariffs in Europe, or European cars be given favourable subsidies, if the continent’s car makers are going to be able to compete with China.

That’s according to Stellantis boss Carlos Tavares, who said that European political leaders should “stop being naive and dogmatic” and recognise that, by legislating in favour of electric vehicles, they are forcing manufacturers to make cars the middle classes can’t afford and steering them towards Chinese models that put the future of the European car industry at risk.

“People cannot afford a safe, clean vehicle,” he said. “Why do we keep adding constantly to the price of cars if they’re safe and clean, and people can enjoy freedoms? A debate has not been had. I ask EU citizens to ask their political leaders for a clear position: are you for or against the freedom of mobility?

“If not, do you want to put your mobility in the hands of the Chinese state? Stop putting restrictions on cars, stop threatening jobs, as making cars has become too expensive.”

Western cars are subject to tariffs and greater restrictions when sold in China, but there are no such restrictions for Chinese cars being sold in Europe.

“Conditions here are easier for Chinese car makers to compete than for Western car makers in China,” said Tavares. “The EU is wide open and it is not acceptable. Don’t support Chinese companies in Europe with easier rules than we’re getting there.”

China has been able to make inroads into the Scandinavian market as buyers there are more brand-agnostic, he said. “That’s why China goes there, with aggressive pricing that I can’t see them making a profit on.”

Tavares believes Chinese car makers are 10 years ahead of their European counterparts in developing electric cars, and being able to build them with greater control of the supply chain and therefore cost. To that end, he advocates tariffs on Chinese-made cars until 2035 to allow European car makers to catch up and be able to compete on fair terms, or for favourable subsidies to be put on European cars. After that point, tariffs should be lifted to ensure European car makers can be globally competitive.

“In this transition period, we need to protect our industry,” he said.

Without tariffs, the only way for European car makers to compete with China is to become even more productive and to find greater efficiencies in building cars. “We’re ready for the fight but it’s going to be harsh,” said Tavares.

“If we don’t protect the industry in this period and keep this vulnerability to Chinese imports, it creates a bigger risk going forward where we will lose our industry. I don’t think leaders want that but there is a reality it could happen.It might be the strategy from China to be in the red for a few years, to grow the market share, and to then grow their prices when we disappear.” 

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Tavares said it was crucial that raw materials for electric car batteries were able to be sourced in Europe, too. “We want control of our supply chain,” he said. “We need EU citizens to accept that we need mines to source materials. To control the supply chain, you need to be able to source your own materials.”

Tavares said he dined with French president Emmanuel Macron on the eve of the Paris motor show, and “we had a lively discussion”. “Now we understand a couple of things,” he added, among them that the EU decisions on electric vehicles are “purely dogmatic”.

“They decided that they were experiencing enough to select the technology, not the industry, said Tavares. “We don’t have regulations that are technology-neutral. It’s EV or disappear. Political leaders made technology decisions and went EV.”

A better solution would have been to commit to a roll-out of clean energy, which takes 20 years, according to Tavares, before a 10-year push to make a charging infrastructure for electric cars and then a five-year lead time for car makers to make the electric cars. “We did this upside down,” he said.

Mark Tisshaw

mark-tisshaw-autocar
Title: Editor

Mark is a journalist with more than a decade of top-level experience in the automotive industry. He first joined Autocar in 2009, having previously worked in local newspapers. He has held several roles at Autocar, including news editor, deputy editor, digital editor and his current position of editor, one he has held since 2017.

From this position he oversees all of Autocar’s content across the print magazine, autocar.co.uk website, social media, video, and podcast channels, as well as our recent launch, Autocar Business. Mark regularly interviews the very top global executives in the automotive industry, telling their stories and holding them to account, meeting them at shows and events around the world.

Mark is a Car of the Year juror, a prestigious annual award that Autocar is one of the main sponsors of. He has made media appearances on the likes of the BBC, and contributed to titles including What Car?Move Electric and Pistonheads, and has written a column for The Sun.

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