Exclusive-Brussels rejected Chinese proposal for a minimum sales price of 30,000 euros in EV disputes, sources say

BERLIN/SHANGHAI/BRUSSELS (Reuters) – Brussels has rejected a Chinese government proposal to sell imported electric vehicles made in China at a minimum price of 30,000 euros ($32,946), three sources said, a move Beijing hoped would would avert EU tariffs. will be imposed next month.

The European Commission said it had rejected minimum price offers from EV makers in China a month ago as part of an anti-subsidy probe that has plunged Beijing and the European Union into their biggest trade dispute in a decade.

Specific details about the compromises offered during negotiations between the two have not previously been reported.

The three sources familiar with the matter declined to be identified because the details are confidential.

China’s Ministry of Commerce and the Commission did not immediately respond to requests for comment. The Commission has previously declined to comment on the negotiations.

In rejecting the Chinese proposal, Brussels said at the time that it was not just about the prices carmakers charge for their Chinese-made electric cars, but also about the subsidies they received for their production and about removing the impact of such support payments.

The Commission had refused to provide details of the offers, with electric car makers in China pledging to respect certain price thresholds to avoid flooding the European market with cheap vehicles that the bloc says local rivals cannot compete with.

Currently, Chinese carmakers such as SAIC and BYD price their EV models in Europe just above 30,000 euros, even though they sell them for a fraction of the price in their home market, highlighting their flexibility, but also the appeal for them when selling in Europe.

BYD’s Seagull, a smaller electric car coming to Europe next year, is expected to cost just under 20,000 euros.

TIME FOR A DEAL THAT IS RUNNING

Details of the offers come as time for a negotiated deal grows tighter, with the Commission saying last week that tariffs of up to 45% on Chinese-built electric vehicles would be imposed for five years from October 31 unless both sides agree a plan B.

On Tuesday, China imposed temporary anti-dumping measures on brandy imports from the EU, hitting French brands including Hennessy and Remy Martin, days after the 27-state bloc voted in favor of the EV tariffs.

China’s Commerce Ministry has previously said it was looking for an alternative to tariffs that would involve a form of “flexible pricing.” It provided no details.

The Commission has said it is ready to reconsider other price commitments, including minimum prices and import quotas, as negotiations continue.

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One solution could be an individually calculated minimum price for each carmaker and possibly by model type, depending on the car’s size and range, the sources said.

One of the sources said minimum price levels of 35,000 to 40,000 euros would be a better benchmark for talks.

($1 = 0.9106 euros)

(Reporting by Victoria Waldersee, Christoph Steitz, Zhang Yan, Christina Amann and Philipp Blenkinsop; Editing by Josephine Mason and Emelia Sithole-Matarise)