According to people familiar with the matter, the European Union is planning to postpone the imposition of a 10% tariff on electric vehicles coming from the UK.
Sources say the EU is seeking industry feedback on a related proposal that would delay the originally scheduled plan to impose a 10% tariff on most electric vehicles starting January 1.
The post-Brexit agreement reached between the EU and the UK stipulates that to enjoy zero-tariff treatment, at least 55% of the value of an electric vehicle must originate from the EU or the UK; among this, the value share of battery cells and modules must reach 65%, while battery packs must reach 70%.
Electric vehicles that fail to meet these requirements will be subject to a 10% import tariff.
However, at the end of 2023, the EU proposed delaying the implementation of these stricter rules by three years.
Following this extension, under the relevant post-Brexit rules, 70% of battery electric vehicles and plug-in hybrid models traded with the EU will face a 10% tariff, and these rules were originally set to take effect in January 2027.
The UK's main automotive industry lobbying group, the Society of Motor Manufacturers and Traders (SMMT), warned in June that if the "local content requirement" issue is not resolved, electric vehicle manufacturers will have to pay 1.4 billion pounds (approximately 1.86 billion US dollars) in tariffs.
The UK and the EU are each other's largest export markets for electric vehicles; both Brussels and London have set goals to phase out fuel-powered models during the 2030s.
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