Xpeng & NIO Respond to EU Tariffs

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As reported earlier today, tariffs are now in place in Europe on electric cars produced in China. When it comes to Xpeng and NIO, two of the “smart electric vehicle” automakers that have been most proactive about selling their cars in Europe, they were not singled out for specific individual tariffs, so they are subject to the 20.8% tariff — since they cooperated with the investigation (rather than the 37.6% tariff for those automakers who didn’t cooperate with it). How are they responding?

First of all, both companies have indicated they are not changing their prices at the moment due to the tariffs. It’s possible they will do so in the future, but any customers awaiting delivery or who are soon going to order can count on the current pricing holding steady.

Both automakers are focused on providing high-quality “smart” electric vehicles that win in Europe based on the level of quality, innovation, and features they are providing. Whether they may in the future raise prices in order to deal with the tariffs better, it remains to be seen, but, arguably, the vehicles are unique enough and offer enough premium tech and features that they should be able to compete at higher price points. The challenge is that these brands are trying to break into very established and often nationalistic markets in a cutthroat environment at this stage of the EV transition. But I think one thing seems likely — you’re not going to get these vehicles at a better deal anytime soon, so it may be worth jumping in and ordering now, in case they raise prices in the future. Of course, that is if Xpeng’s or NIO’s vehicles are the ones you’re most pining for.

Xpeng is already considering and exploring another possibility, too. The company is looking into producing electric cars in Europe. “As a global company, we are committed to providing high-quality innovative products to the ever-growing European customer base and making long-term commitments to these markets,” Xpeng said.

Of course, if Xpeng does initiate EV manufacturing in Europe, that could also lead to different pricing in the region. However, in any case, we are far from the point when the first EU-produced Xpeng vehicle would roll off a production line.

In short, for the time being, NIO and Xpeng are going to be swallowing the cost of the extra EU tariffs on China-produced electric cars. In the future, they may raise prices to better handle those tariffs, and Xpeng may even begin producing EVs in Europe at some point. But I’m sure they are also hoping to see reduced tariffs when a final decision is made on this topic within the next four months. A 20% increase in costs or 20% price increase, or some mixture in the middle, is not ideal for any manufacturer, and certainly not one that is just trying to break into a tough new market.

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Zachary Shahan

Zach is tryin' to help society help itself one word at a time. He spends most of his time here on CleanTechnica as its director, chief editor, and CEO. Zach is recognized globally as an electric vehicle, solar energy, and energy storage expert. He has presented about cleantech at conferences in India, the UAE, Ukraine, Poland, Germany, the Netherlands, the USA, Canada, and Curaçao. Zach has long-term investments in Tesla [TSLA], NIO [NIO], Xpeng [XPEV], Ford [F], ChargePoint [CHPT], Amazon [AMZN], Piedmont Lithium [PLL], Lithium Americas [LAC], Albemarle Corporation [ALB], Nouveau Monde Graphite [NMGRF], Talon Metals [TLOFF], Arclight Clean Transition Corp [ACTC], and Starbucks [SBUX]. But he does not offer (explicitly or implicitly) investment advice of any sort.

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