New commercial quarrel between Europe and the United States around electric cars
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Are we going to see a return to the trade war between Europe and the United States? After the disputes over subsidies to aircraft manufacturers Airbus and Boeing or on customs duties applied to European steel and aluminum, now appeased, another file poisons relations between Washington and Brussels. The creation of a tax credit of up to 7,500 dollars (7,520 euros) for the purchase of electric vehicles produced (battery included) in the United States, Canada and Mexico. This measure was passed on August 11 by Congress as part of Joe Biden’s Inflation Reduction Act.
If, in Brussels, we understand the internal political springs of such a decision with the approach of the mid-term elections, the American democratic president being strongly supported by the powerful union of the automobile the UAW very established in certain States in the Midwest, this decision is no less discriminatory for Europeans. And all the more so since on the Old Continent, most member countries have set up aid and other bonuses for the purchase of “wattures” (electric vehicles) regardless of their place of production.
For many European actors, it is therefore urgent to act. As of August 17, the Association of European Automobile Manufacturers reported its strong ” disappointment “ after the announcement of the American measure. “Purchasing subsidies are very important to launch a market and facilitate the adoption of electric vehiclesrecalls the European lobby. In order to achieve the goal of 50% of zero-emission car sales by 2030, much more inclusive support measures are needed. »
A very profitable market for Europeans
The United States, with a still modest share of electric outlets (5.6% in the second quarter of 2022, i.e. 432,000 models sold), is a historically very profitable market for European brands, and especially German ones. If Volkswagen has lost its luster there since the “dieselgate”, Audi, BMW, Mercedes or Porsche are still holding out on Tesla and together sell nearly a million sedans there each year. In short, these groups intend to make a profit from their colossal investments in their new electrified models.
In Washington, the Alliance for Automotive Innovation, a lobby that brings together American and European manufacturers, also recalls that “out of 72 electrified models offered today in the country, 70% could not be eligible. And none will be able to obtain the full tax credit when it is necessary to take into account the place of supply of the basic materials of the batteries [terres rares, lithium, etc.] », writes John Bozzella, the president of this alliance on his blog.
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