Brexit can wait, at least when it comes to electric cars and batteries. The European Commission has actually offered EU governments a three-year delay in the introduction of customs duties on electric cars marketed with the UK, envisaged in post-Brexit agreements. The requested extension is a ‘one-off’ until December 31, 2026, and there is a clause that excludes the additional extension in 2027.
The decision comes amid concerns voiced by the European automotive, battery and chemical industries. Current rules of origin for electric vehicles and batteries were designed in 2020 to encourage investment in EU battery production capacity, but the European Commission explains: “Conditions unforeseen in 2020, including Russia’s aggression against Ukraine, the impact of the pandemic on supply chains” and increased competition from new international support regimes (China and also the USA) have led to a situation where the expansion of the European battery ecosystem is slower than initially expected.”
There is therefore a request from Brussels to extend the existing rules and postpone the introduction of a 10% tax that will affect electric vehicles that fail to reach 45% of components produced between the EU and the UK from January 1. European Commission Vice-President Valdis Dombrovskis explained that the proposal “is the result of intense engagement with the industry across the entire electric vehicle supply chain and with unions who have expressed concerns about the rules they will see.” Tariffs will affect our electric vehicle exports to the UK, our largest export market.” Dombrovskis added that introducing tariffs “would clearly be against our interests and would further strengthen competition with electric vehicles produced abroad, especially in China.”
In parallel with the postponement of tariffs, the Commission announced an allocation of up to 3 billion euros to stimulate the European battery industry and meet the demands of the electric car sector. According to Brussels, resources from the Innovation Fund will have “significant spillover effects for the entire European battery value chain, especially for the premium segment, in addition to supporting the assembly of electric vehicles in Europe.”
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Source: Today IT
Karen Clayton is a seasoned journalist and author at The Nation Update, with a focus on world news and current events. She has a background in international relations, which gives her a deep understanding of the political, economic and social factors that shape the global landscape. She writes about a wide range of topics, including conflicts, political upheavals, and economic trends, as well as humanitarian crisis and human rights issues.
