As of July 5, the EU will introduce additional tariffs on Chinese electric vehicles (EVs) entering the region. The new duties, imposed in addition to the existing 10% tariffs. While NIO and XPeng collaborated with the EU investigation, they did not secure a personal exemption and thus remain subject to the 20.8% tariff imposed on companies in their industry. The initial responses from various corporations seem to follow a standard template with little variation. As Xpeng continues to explore opportunities, it’s likely that its production strategy may shift, with a possible pivot towards manufacturing in Europe on the horizon. Tariffs imposed today, with decreases smaller than initially expected, are intended as a temporary measure until the remainder are implemented in November 2024.
Nió has announced its intention to maintain its current pricing strategy in Europe while reassessing it in light of ongoing tariff developments. During the January 2024 quarterly earnings call, Nio CEO William Li noted that Europe represented a relatively small percentage of the company’s overall revenue, suggesting that tariff impacts would be minimal in the short term. NIO will develop a cost-effective strategy aligned with evolving tariff scenarios.
Xpeng has committed to maintaining existing commitments to customers already prepared for delivery or those who had placed orders before the introduction of the new tariffs, ensuring they are exempt from price hikes. Xpeng is exploring the possibility of establishing a production facility in Europe, as part of its ongoing efforts to expand its global footprint and enhance its manufacturing capabilities.
As of July 5, the provisional tariffs have taken effect, targeting SAIC and non-cooperating companies with a duty rate of 37.6%. While BYD faces a 17.4% tariff and Geely is subject to a 19.9% tariff, their counterparts are hit with a 20.8% duty on all electric vehicle imports from the EU. The European Union plans to establish a contingency plan by November 2024.
By the end of 2023, Nio’s total revenue from automotive sales across Europe reached a significant milestone: 2,399 vehicles. Currently, NIO boasts a network of 43 battery-swapping stations and 45 high-power charging points across the region, offering customers access to over 600,000 third-party charging points in addition. Currently, NIO offers a range of electric vehicles across Europe, including the ET7, ET5, EL6, EL7, and ET5T, with the latest addition being the EL8. The Nio ES8, also known as the EL8, has recently made its formal debut in Norway, Germany, the Netherlands, Sweden, and Denmark. In Germany, the price tag for the Nio EL8’s 75 kWh model is significantly higher than its Chinese counterpart, at €94,900 (approximately $102,700), compared to ¥498,000 (around $68,500) in China.
Xpeng officially debuted in Germany’s market in March 2023 by introducing its Xpeng G9 and P7 models. The corporation also operates in Scandinavian countries and France, with ambitions to expand into Italian and British markets alongside. XPeng aims to capture a 3% market share in Germany’s new energy vehicle market by year-end, leveraging its 12 local partners and 24 retail locations across the country.
Chinese electric-vehicle makers NIO and XPeng are expanding their presence globally, with both companies recently seeking to enter the UAE market outside of Europe. XPeng is expanding its presence in both Southeast Asian and Central Japanese markets.
Sources: Autohome, Quick Expertise, Autohome
