<p><img src="https://hawk-oss.hawkinsight.com//picture//202406/1188938180_140.jpg" style="width: 100%;">BYD made a profit of $15,400 in Europe through BYD Seal U, compared to $1,400 in China.。According to a report by the Rongding Group, this means that BYD's profit on each Seal U model sold in the EU has increased by $14,000, which is called "EU premium."。- Advertising - On June 12, the European Commission (EC) investigation revealed that China's pure electric vehicles (BEV) and supply chain receive unfair subsidies。As a result, the European Commission imposed a 17.4% to 38.1% temporary import duty, depending on manufacturer。These new tariffs are in addition to the existing 10% tariff。According to the Rongding Group, a 30% tariff on BYD Seal U (see specifications) is not enough to equalize the car's profits between the EU and China, which means the paving site is still uneven。The 30% tariff would still give the company a 15% ($5,080) EU premium over its profits in China.。That means BYD still earns more than $5,000 more for Seal U sold in the EU than it does in China。This will keep exports to Europe highly attractive。-Advertising-In addition, this level of tariffs will provide BYD with room to reduce prices to win European market share。Rhodium said: "Our analysis of several other models sold in China and Germany shows that even with a 30% tariff, many Chinese electric car models will still enjoy a strong EU profit premium.。The report suggests that higher tariffs may be needed, which could be as high as 45% or even 55% for a highly competitive producer like BYD, making exports to Europe less attractive.。However, tariffs could have a negative impact on Western automakers。A 15% to 30% tariff could hurt the business model of foreign companies such as BMW or Tesla that export to Europe through China.。For BMW's iX3 SUV, the EU premium (after taking into account costs such as transportation) is only 9%。This means that if the tariff exceeds 9%, BMW will earn less from sales in Europe than from sales in China.。Higher tariffs could also disrupt plans by companies such as BMW, Honda and Volkswagen to increase their use of China as an export hub for the EU market.。- Advertising - BMW Brilliance (BMW's joint venture in China) and Tesla were hit with a 21% tariff for cooperating with a European Commission investigation.。In addition, Tesla applied for further personal assessment。The price difference between foreign and Chinese producers is because Chinese producers receive more subsidies than foreign producers, although both are supported by the Chinese government.。In addition, Chinese companies are more vertically integrated, which means they handle more production processes themselves, which allows them to buy products at lower prices than foreign companies。For example, BYD not only makes cars, but also owns lithium mines, makes its own batteries, develops its own electric motors, owns large export shipping ships, and even owns a vehicle insurance company。Price comparison between China and EU。Source: Rongding Group。In addition, the fierce price war is driving down the price of electric vehicles in China for all automakers, especially those established automakers that have difficulty competing with China's new electric vehicle startups。Volkswagen ID.The price in Europe is cheaper than in China, because the price in Germany is 46,335 euros (50,000 dollars), while in China, the price of the 80 kWh version is 33,500美元。However, Rongding is only calculated at the suggested retail price, and Volkswagen dealers sell ID in China..The actual price of 4 is RMB 182,400 (US $25,150), as shown in the figure, which makes the gap even wider。Chinese EV makers ready to boost exports despite possible EU tariffs。Factors driving this trend include slower growth and narrower profit margins in China's new energy vehicle market, as well as stimulating exports。China sees the EU as a major export destination because of its attractive market conditions and ambitious targets set by companies such as BYD and SAIC-owned MG to capture significant market share in Europe.。</p>