The two parties have been discussing a potential deal involving price undertakings—a sophisticated method for managing export prices and quantities to prevent tariffs.
According to sources with knowledge of the situation, the European Union notes only minimal advancements in its discussions with China regarding an alternative to the tariffs imposed on electric vehicles. Currently, the prospects for a swift resolution appear bleak. This week, we will see a continuation of technical discussions between the two parties, following some mutually acknowledged progress in previous talks held in Beijing.
However, the likelihood of reaching an agreement remains low for the time being. The informants, who requested anonymity, explained that China has not yet aligned with the EU’s stringent demands for ensuring that any agreement is enforceable and corresponds to the impact of the anti-subsidy tariffs introduced by the bloc last month. The ongoing negotiations are centered around the possibility of implementing price undertakings—a sophisticated strategy to regulate export prices and quantities as a tariff alternative.
The focus of recent negotiations has primarily been on setting up a communication framework between Brussels and Beijing and on mitigating the risks associated with cross-compensation. This involves concerns that any established minimum import prices for electric vehicles could be counterbalanced by the trade of other commodities, such as hybrid vehicles and related accessories, the sources mentioned.
