Tesla and BMW are leading a legal charge against the European Union (EU) over its imposition of tariffs on electric vehicles (EVs) manufactured in China.
The lawsuits, filed with the European Court of Justice (ECJ), challenge the EU’s anti-subsidy duties, which were introduced in late October 2024 following an investigation into Chinese government support for EV manufacturers.
The EU’s probe concluded that Chinese automakers, including Tesla’s Shanghai operations, benefited from subsidies such as low-interest loans, cheap land, and supplier discounts. In response, the EU imposed additional tariffs ranging from 7.8 per cent for Tesla to as high as 35.3 per cent for other manufacturers, on top of the existing 10 per cent standard import duty.
Tesla’s lawsuit, filed by its Shanghai division, follows similar legal action by BMW and several Chinese manufacturers. While Tesla’s filing does not disclose specific arguments, the company’s relatively lower tariff rate reflects an individual review that found it received less government support compared to its competitors.
The case will be heard in the EU’s General Court, the bloc’s second-highest judicial body, with the possibility of appeals to the ECJ. The legal process is expected to take approximately 18 months, during which the future of EV imports into the EU hangs in the balance.
The tariffs have significant implications for the European EV market. According to The Financial Times, around 20 per cent of EVs sold in the EU last year—approximately 300,000 units—were made in China. The duties could disrupt supply chains, increase costs for consumers, and reshape the competitive landscape.
