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Britain fires off warning over cheap Chinese car ‘dumping’

Britain will use “robust” trade sanctions to prevent China from flooding the car market with cheap electric vehicles (EVs), the Transport Secretary has said.

Mark Harper issued the warning on Thursday when asked about the risk posed by Chinese brands pushing into Europe with new low-cost models.

He pointed to the post-Brexit trade remedies regime, which can levy tariffs on imports deemed to have unfair advantages, as a way to stop Chinese EVs from inundating Western markets.

The comments are the clearest indication yet that ministers are keen to crack down on incoming EVs from the Far East.

It is expected to fuel speculation that the Government will launch an investigation into claims that Chinese EVs have benefitted from significant state support, following similar investigations already underway in the European Union and the US.

Mark Harper

Transport Secretary Mark Harper says he wants to ensure there is a ‘level playing field’ in the electric car market


Speaking at the SMMT Connected conference in London, Mr Harper said: “First of all, I understand why some people are concerned about that.

“The issue I think most people are concerned about, that our concern is about [is] cost and competitiveness.

“We have very robust measures in this country, with a trade remedies regime which deals with not just the car industry but all markets, about making sure we have fair international trade, and that we don’t have dumping or unfair subsidy.

“So I think we have a good legal structure. That is the structure that will make sure that competition is fair and that there’s a level playing field.”

Mr Harper said that he wanted as many manufacturers in the market as possible, but added: “The important thing is it’s a fair, competitive landscape.

“I know if the competition is fair, British manufacturers are absolutely at the table and we’ll be able to compete with anybody in the world both domestically, but also exporting technology around the world.”

The remarks are the first public acknowledgement by a minister that Britain could resort to trade tariffs if Chinese cars are found to have benefited from large state subsidies.

Since 2009, China’s central and local governments have subsidised domestic EV businesses to the tune of $100bn (£78bn), according to a study by the Washington-based Center for Strategic and International Studies (CSIS).

The claims have triggered an anti-subsidy investigation by the EU, which could put pressure on the UK government to act if it is found that Chinese brands have received an unfair advantage.

Meanwhile, President Joe Biden’s administration in the US has branded Chinese EVs a risk to national security and threatened to hit them with punishing restrictions.

So far, the UK government has insisted it has not begun any investigation of its own and that such a move would only be triggered by a formal complaint from carmakers.

But it was reported last month that the Department for Business and Trade had begun preparations and was examining various options.

Meanwhile, Giorgia Meloni, the Italian prime minister, is wooing Chinese electric carmaker Chery Automobiles amid an ongoing war with national champion Stellantis.

Ms Meloni’s government has been holding talks with the state-owned group, China’s third-largest carmaker, about setting up a European production plant as the country pushes to hit ambitious production targets.

Chinese producers BYD and Great Wall Motor have also been sounded out about the plan, with Chery emerging as the leading candidate to open a new factory, Reuters reported.

Chery focuses on electric vehicles (EVs) and has previously indicated plans to open a plant in the UK during the next decade.

Italy's Prime Minister Giorgia Meloni

Italian prime minister Giorgia Meloni attacked Stellantis, saying a car being sold as an ‘Italian jewel’ must be made in the country


Italy is aiming to increase annual vehicle production from 800,000 vehicles per year to 1.3 million. Its government wants Stellantis, the only carmaker left in Italy, to help hit the target. The group has been urged to increase production to one million vehicles per year from 750,000.

However, this has led to tensions between the two sides. Earlier this year Ms Meloni attacked Stellantis, saying a car being sold as an “Italian jewel” must be made in the country.

Stellantis is controlled by Italy’s Agnelli family, which founded Fiat, but Meloni loyalists fear too much car production is moving overseas.

The company has faced criticism from Ms Meloni for ditching its Italian roots and listing shares in New York.

Luring Chery to Italy could help build another 300,000 cars, helping the government hit the 1.3 million target. Chery was contacted for comment.

Separately, industry chiefs warned on Thursday that Britain is falling behind Europe and the US on driverless cars as slow progress on regulation forces start-ups to deploy their technology abroad.

Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders (SMMT), on Thursday urged MPs to swiftly pass new laws legalising fully autonomous vehicles on the road, noting that other Western governments had already done so.

The Automated Vehicles Bill was announced in the King’s Speech in November, having first been mooted in 2018. It is currently working its way through Parliament.