"Low Tariffs Hit UK Hard... Is South Korea Next?"

The UK, which has not imposed additional tariffs on Chinese electric vehicles, is considering levying high tariffs of up to 45.3%, a level similar to that of the European Union (EU).

According to The Times, the backdrop behind the UK government's review of a policy shift is the rapidly growing influence of Chinese companies in the British automotive market.

From January to August of this year, the combined market share of five major Chinese automotive groups—including Geely, Chery, SAIC, BYD, and Leapmotor—reached 19.7% in the UK new car market.

This is nearly a fourfold increase from their 5% market share in 2021.

During the same period, the market share of Chinese companies in the EU market stood at 9.6%, meaning the UK's figure is double that of the EU.

Tariffs are cited as one of the factors that created the difference between the two markets.

Citing that Chinese government subsidies could harm the European automotive industry, the EU has additionally imposed countervailing duties of up to 35.3% on Chinese electric vehicles since 2024.

Combined with existing tariffs, the total reaches up to 45.3%.

In contrast, the UK has maintained a baseline tariff of 10%.

Leveraging relatively low tariffs and price competitiveness, Chinese companies quickly increased sales of electric and hybrid vehicles in the UK market.

In addition, pressure from the EU is adding to the UK's dilemmas.

The EU is linking the issue of tariffs on Chinese electric vehicles with whether to include British-made automobiles in its "Made in Europe" policy, which favors products manufactured within the bloc.

This means that if the UK does not set up trade barriers against Chinese electric vehicles at a level comparable to the EU, British automobiles could face disadvantages in receiving subsidies or tax benefits in the European market.

The UK government finds itself at a crossroads, having to attract investment from Chinese companies while also maintaining the EU export competitiveness of its existing domestic auto factories.

Similar concerns are emerging in South Korea, where sales of Chinese electric vehicles are growing rapidly.

In the first half of this year, the proportion of Chinese-made vehicles among newly registered electric cars in South Korea reached 35%, a figure that includes not only Chinese brands like BYD but also Tesla vehicles produced at SAIC's factory in China.

The domestic automotive industry is calling for improvements to tax support and subsidy systems for domestically produced electric vehicles, warning that intensified price competition with Chinese electric vehicles could reduce the future investment capacity of domestic finished car and parts manufacturers.

Reported by Kim Minjeong | Video by Lee Yujin | Graphics by Lee Jeong-ju | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.