The German Association of the Automotive Industry (VDA) is pushing back against potential European import tariffs on electric cars from China, fearing the repercussions of sparking a trade war with the Asian nation. VDA President Hildegard Müller expressed concerns in an interview with Die Welt, emphasizing that additional tariffs may not resolve issues for the European and German auto industries and could, in fact, exacerbate them.

The European Commission initiated an investigation last year into potentially market-distorting Chinese subsidies for electric cars, which could result in punitive tariffs. Müller argued that the import duties proposed by the European Commission could quickly have a negative impact in the event of a trade conflict.

German automakers fear retaliatory measures on the crucial Chinese market. China has become the primary market for German luxury brands such as Mercedes-Benz and BMW. Müller warned that a trade war between Europe and China could also impede the transition to electric vehicles.

The European Commission contends that China heavily subsidizes its domestic electric car manufacturers, allowing them to produce vehicles at lower costs and potentially squeeze out European competitors with an unfair advantage.