In its leap to electric cars, Europe fears total dependence on China. Your solutions arrive (quite) late

The rope tightens. This time it is Europe that pulls to its side. Or, at least, that is what he wants according to what is stated in Financial Timeswhere we read that the European Union wants to force car manufacturers to reduce their level of dependence on China. Now, forcing them to buy fewer components from their suppliers.

A new goal. It is, according to Financial Timeswhat the European Union wants to impose on companies in key sectors such as automobiles, industrial machinery or the chemical sector. In the newspaper’s information we read that European institutions are looking for tools to put pressure on their own companies.

In the information, which is attributed to two European officials familiar with this project, the objective is to put a limit on the percentage of components that can be supplied to a single country. That is, if a company wants to manufacture a product in Europe, it could not buy all of its components (or the vast majority) from China.

To distribute the purchases. If the project goes ahead as we read in the British media, a company could only buy between 30 and 40% of its components from the same country. It is sought that, at least, the origin of the parts that, in this case, make up a car is from three suppliers and from at least three different countries. This would not be much of a problem if it were not for the fact that the 30-40% barrier could not be overcome.

“Gradually dependent”. “In many areas we are gradually becoming dependent on China’s exports,” the words are from a senior European Union official consulted by the newspaper. According to Financial Timesthe organizations are very aware of the extent to which a stoppage of Chinese factories or exports can damage the European economy.

In fact, last summer some factories had to stop or saw their production compromised after China put greater impediments to export of products in which rare earths are used such as the magnets in electric car motors.

Just a few months later, The Nexperia crisis once again set off the alarms of possible interruptions in the supply chain since a good part of the chips used by the European industry uses components from this company. They are not key products for its operation but without them, a car cannot be sold because They are essential for auxiliary but basic functions How to raise and lower the car window.

1 billion. That is what, according to Financial Timesthey calculate in the European Union that we lose to China. 1,000 million euros of deficit in the trade balance.

1,000 million. Diaries.

The figure has been floating for two years now. and the automotive industry is one of those that has suffered the most. According to the European Union, they have achieved this with a doped industry, which has led to the lifting of tariffs on electric cars arriving from China. And the Chinese manufacturers have wanted to land abroad on our continent but also the Europeans have wanted to manufacture in China because it was cheaper.

Spain? According to Anfac dataIn Spain we have a deficit in our trade balance of 5,000 million euros annually if we talk about components. As the second largest car producer in Europe, our auxiliary fabric is not enough and we need to buy components worth 16,893 million euros when exports exceed 11,525 million euros.

There is no data on the origin of these imported components but we do know that The second country that exports the most cars to Spain is China. Last year, 9.2% of cars purchased in our country from outside our borders arrived from China. Very far, yes, from the German 26%. The problem is that despite importing cars worth almost 2.7 billion euros, China does not appear among the 10 countries to which we export the most cars and we barely place 658 million euros in exports to all of Asia.

The game of balance. Yet the European Union is discovering that perhaps it has arrived late to the trade battle. Yes, it has lifted tariffs on electric cars sold from China but the country’s tentacles reach deep into vehicles made in Europe, producing all kinds of cheap components but also producing key technology such as semiconductors or batteries of electric cars.

China is aware that it can squeeze European industry but it also needs our trade to export all the cars that are already surplus there. It is no coincidence that Europe has not imposed tariffs on cars arrived with combustion engines and? have negotiated with China the possibility of lifting trade barriers to electric cars.

The Band-Aid. Until now, a very important part of the components used in European cars had their origin within the borders of the European Union itself. However, China’s weight has skyrocketed in recent years. In 2024, China has already become the main exporter of cars to Europe and the weight of its components within the cars manufactured here is increasingly greater, which reduces the competitiveness of our exports, according to this report BBVA.

This imbalance is doubly worrying because the European Union is trying to reduce Chinese dependence now that it is seeking to make the definitive leap to the electric car, a technology where the Asian country dominates the supply chain. In recent months, Europe has tried to curb dependence promoting mineral mining on our soil or battery production but Chinese dependence remains evident.

Photo | Michael Fourset and Sou Jest

In Xataka | Japan has been charging a 0% tariff on foreign cars for half a century. It will be very difficult for you to find one on the street.