Batteries are pretty expensive but a good one should last a long time. I would do the ebike thing if I wasn't driving three people everyday.
Starmer’s Labour government is in a tight spot. It’s sticking by an election manifesto pledge to ban the sale of new combustion engine cars by 2030.
But while the pressure is on to boost EV imports, his business and trade chief Jonathan Reynolds is also drawing up an industrial strategy to encourage global automotive firms to invest in more factories in the U.K.
“All these things are not necessarily compatible,” the senior automotive figure said, adding Labour has “got some pretty difficult choices to make in the autumn.”
Behind the scenes, the U.K. government is weighing up whether to follow its Western allies in hitting Beijing. Ministers want to avoid a trade war with China that could hurt the economy.
British factories rolled out 34,094 fewer cars in the first half of 2024, down 7.6 percent on 2023. | Andy Buchanan/AFP via Getty Images
Officials are “trying to boil the ocean” in their research, the senior automotive figure said, by also examining “what might happen to Chinese investment” in the U.K. if it does impose tariffs.
The British government is “increasingly aware of different trade-offs associated with intervening” against Chinese EV imports, said Sam Lowe, a partner at Flint Global specializing in trade and EVs.
The risks are real: Beijing has retaliated against steep EU duties on Chinese EVs in July with anti-subsidy investigations against EU dairy, pork and brandy. While Beijing last month decided not to impose tariffs on EU brandy for now, it is also challenging the EU’s tariffs at the World Trade Organization.
Several sectors across the British economy, including luxury carmakers, are urging Starmer’s government to tread carefully.
That means the U.K. is unlikely to ultimately copy its allies’ tariffs on Chinese EVs. “We don’t want to close the U.K. economy down to imports and exports. We benefit from those trade links around the world including with China,” Chancellor Rachel Reeves said in a July interview.
“This issue about what [Chinese] retaliation would mean, for exporters, as well as what the tariffs would mean for inflation here is something that the Treasury has considered as the primary argument,” said a senior British business lobbyist briefed on the government’s thinking.
The U.K. is unlikely to ultimately copy its allies’ tariffs on Chinese EVs. | Pedro Pardo/AFP via Getty Images
Reeves’ most recent intervention is sharply at odds with her messaging ahead of the U.K. election in May when she said reliance on Chinese EVs would undercut British workers and “leave us incredibly exposed.”
After the chancellor backed away from tariffs, Stella Li, European head of Chinese EV giant BYD, said “the U.K. can very rapidly become the next country with very strong EV adoption.”
‘In the foothills’
If Britain does stay out of the tariffs game, there could be clear knock-on effects for its domestic carmakers. As Britain’s allies erect tariff walls there’s an “obvious” risk Chinese electric vehicle exports will be diverted to the U.K., Nick Baird, chair of Britain’s trade watchdog the Trade Remedies Authority (TRA) told POLITICO early this year.
There are already signs this is happening. Chinese automakers are targeting Britain and Norway, another non-EU nation, with more electric vehicle exports, analysis from consultancy Schmidt Automotive Research shows. The U.K. will be “a major catalyst” for Chinese auto sector growth in 2024, Mathias Schmidt, founder of the consultancy said.
Chinese brands are hoping to cash in on the increasing demand for EVs generated by the U.K.’s new zero emissions vehicle rules, he added.
“We're in the foothills at present in terms of what the market impact might be,” said the senior automotive figure quoted at the top of the piece. “If we start to see that number creeping up substantially, then it might put additional pressure on the U.K. government to yank this up the priority table.”
That's because tariffs are paid for by the population of the country being imported to.UK may decline imposing tariffs on Chinese EVs.
That's because tariffs are paid for by the population of the country being imported to.
The EU imposed import tariffs of varying levels on different Chinese manufacturers in the summer, but Friday's vote was to decide if they were implemented for the next five years.
The charges were calculated based on estimates of how much Chinese state aid each manufacturer has received following an EU investigation. The European Commission set individual duties on three major Chinese EV brands - SAIC, BYD and Geely.
EU members were divided on tariffs. Germany, whose car manufacturing industry is heavily dependent on exports to China, was against them. Many EU members abstained in the vote.
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The industry has warned that drivers need better incentives to buy electric to help manufacturers ahead of the planned ban on sales of new petrol and diesel vehicles. Under the Conservative government the deadline for this ban was pushed back to 2035 from 2030, but Labour has pledged to bring it back to 2030.
Car makers are required to meet electric vehicle sales targets. Under the Zero Emission Vehicle (ZEV) mandate, at least 22% of vehicles sold this year must be zero-emission, with the target expected to hit 80% by 2030 and 100% by 2035. Manufacturers that fail to hit quotas could be fined £15,000 per car. The bosses of several car companies, including BMW, Ford and Nissan, wrote to Chancellor Rachel Reeves on Friday saying the industry was likely to miss these targets.
ZEV mandate will make fossil fuel cars thousands of pounds more expensive, this will somehow reduce investment in EVs because of reasons ... the car manufacturers are so fucking full of it.
For one, we can’t overlook the dismal sales numbers for the Q8 E-Tron, with the 120,000-vehicle-capacity plant reaching its peak in 2022 with 47,900 cars, compared to 37,400 Q8 E-Trons last year. This year, Audi has delivered 23,900 vehicles.
But other issues have also plagued the Belgian plant. For one, it is located on a railway line, making expansion impossible, and there is no body shop on site, meaning imported body components have to be supplied from other plants. The successor to the Q8 be made in Mexico, and Audi doesn’t plan to move any new models to the Belgian plant.
The 3,000 factory workers employed there will likely lose their jobs, which is stirring up pushback from unions that argue that the company is too resistant to consider other offers. “The only thing they want to do is close the plant as quickly as possible.,” said Ronny Liedts of the ACV-CSC union, as quoted in Automotive News Europe. “None of the alternatives work for them.”
Last month, huge rallies blocked the Belgian capital over the potential closing of the plant, with unions warning of further strikes and protests. Now, the factory has become a symbol for what protestors say is the real problem: It’s not that people don’t want to drive EVs, it’s that European automakers are focusing on large SUVs that the average person can’t afford.
“Car manufacturers wanted to make big profits with electric vehicles right away and did not accept that the transition phase would generate fewer dividends and profits,” Hillal Sor, a trade unionist at Metallos FGTB, told Euronews. “So they bet everything on large, very luxurious, very expensive models that European citizens cannot afford.”
Sales figures back this up: The first eight months of this year, some 902,000 electric cars were purchased in the European Union, representing only 12.6% of the total number sold. To support the EV transition, unions say that are pushing for more public funds. The European Parliament agreed last month to consider tariffs on Chinese EVs and other protectionist measures are on the table.