European carmakers seek delay to EU-UK EV tariff rules

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Carmakers seek EV tariff delay

Highlights

European Automobile Manufacturers Association urges EU to delay strict EV content rules, proposing battery pack assembly be postponed to 2030 and cathode material requirements to 2032.
ACEA warns that 82 percent of 520,000 EU EVs and vans, worth €17.9bn, sold to the UK in 2027 would otherwise incur tariffs.
Manufacturers cite slow EV adoption, delayed battery supply chains, and Northvolt's failure as drivers for requesting a five-year phased rule introduction beyond the 2027 deadline.

Industry request and proposed timeline

As reported by the Financial Times, the European Automobile Manufacturers Association has asked the European Commission to postpone stricter content rules for electric vehicles, warning that most models sold between the UK and the continent would not qualify as European-made under the current timetable.

In a letter seen by the newspaper, ACEA says continued reliance on China for batteries and raw materials means the sector is not ready for the January 1 change. Brussels and London had already agreed to delay the tougher requirements from 2024 to 2027, but manufacturers are now seeking a phased introduction over five years.

ACEA proposes delaying a battery pack assembly requirement until 2030 and an added requirement for originating cathode material until 2032. The group says about 82 per cent of the 520,000 electric passenger cars and vans that EU producers expect to sell in the UK in 2027, worth €17.9bn, would otherwise face the tariff.

Pressure on UK trade and European supply chains

The UK industry is taking a similar position because many of its car exports to the EU also face 10 per cent tariffs unless the rules are delayed. Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, says neither side can afford measures that raise costs, undermine investment or reduce consumer choice during a period of intense global competition.

Manufacturers argue that slower-than-expected electric vehicle adoption and delays in building battery supply chains have made compliance harder to achieve. They also point to the collapse of Swedish battery maker Northvolt and broader difficulties among European producers in scaling up output.

The UK is the biggest export market for EU carmakers, and ACEA says any drop in sales would damage both the emerging European battery industry and the region's electric vehicle sector. In addition to the tariff risk for EVs and plug-in hybrids, UK manufacturing is also facing uncertainty over whether British-built cars fully qualify for Brussels' new Made in Europe subsidies.

The European Commission and the UK government do not immediately comment.

Our earlier article on the EU’s push to rein in Chinese hybrid car exports explained how Brussels was urging Beijing to accept voluntary limits to avoid a wider trade confrontation and ease pressure on European automakers. It also outlined the EU’s deadline for tangible progress on narrowing the trade gap with China, and how senior EU officials were positioning the bloc’s negotiating stance ahead of talks.

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