BMW’s Electric Mini Faces Highest EU Tariff, Threatening Sales

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BMW’s all-electric Mini, manufactured in China, is set to be subjected to the highest EV tariff of 38.1% under the EU’s provisional plans, according to a source familiar with the matter. This tariff poses a significant threat to the sales prospects of the mid-range vehicle.

Production and Joint Venture

Mass production of the electric Mini, priced at approximately 35,000 euros ($37,345), began late last year. The vehicle is produced through a joint venture between BMW and China’s Great Wall Motor Co Ltd. This production timeline coincided with the EU’s investigation into EV imports.

EU Investigation and Tariff Details

Due to the early stage of production, the joint venture could not provide the detailed information required by the European Commission’s survey. As a result, it did not qualify as a cooperating company in the investigation. Companies that cooperated with the EU were subject to lower tariffs ranging from 17.4% to 21%, as indicated in a European Commission document seen by Reuters. This includes BMW Brilliance Automotive, another joint venture that has been exporting the electric iX3 to Europe since 2021.

Industry Response

BMW has declined to comment on the tariff situation. However, BMW CEO Oliver Zipse recently criticized the tariffs, calling them the “wrong way to go.” This sentiment is shared by other German carmakers who fear a potential trade war and the possibility of counter-tariffs on cars exported from Germany to China.

Potential Impact and Future Steps

The European Commission has stated that joint ventures producing cars in China will be subject to duties but did not specify if newer ventures could benefit from the lower 21% rate for cooperating companies. A 38.1% price increase on the Mini, intended for export from China to Europe, could severely impact sales at a critical time when the carmaker needs every all-electric sale to meet tightening carbon emissions targets.

Timeline and Next Steps

The provisional measures are set to be imposed by July 4, with the investigation continuing until late October. This period allows for potential negotiations between Beijing and Brussels to mitigate the impact. Additionally, companies can submit comments and request hearings after the provisional duties are applied.

For more updates on this developing story, stay tuned.

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