US plans tariffs on Chinese EVs, other sectors: report

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US President Joe Biden is about to announce a new tariff scheme targeting key Chinese industries, such as electric cars, semiconductors, and solar machinery, sources told Reuters.

The plan is likely to continue existing tariffs, though there appears to be a focus on fields related to strategic competition and national security. While the Office of the US Trade Representative gave the recommendations awhile back, Biden’s announcement has been delayed after internal debates.

The tariffs differ from what was suggested by former president Donald Trump, which would apply to all Chinese exports rather than specific sectors. Biden’s officials, however, believe this measure might trigger inflation.

The US is also said to be reviewing Chinese activities in the shipping and logistics industry, which may lead to extra levies. These steps may trigger a response from China, adding to the already high tensions between the world’s biggest economies.

China has been dominating EV production and sales. In 2023, the country accounted for 60% of global EV sales, and brands like Wuling and BYD have pursued growth in countries like Thailand, Vietnam, and Indonesia.

BYD in particular has been a major competitor to Tesla: The former overtook Tesla as the leading EV maker in the fourth quarter of 2023, though Tesla regained the position in Q1 this year after the Chinese brand’s sales plummeted by 43%. Nonetheless, BYD’s rise has prompted Western automakers to adapt their EV strategies to stay competitive.

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