tire

The European Commission has approved antidumping tariffs definitive rates on tires for passenger cars and light vans from China, which range between 4.3% and 45.3% depending on the manufacturer. The measure comes after an investigation opened in November last year and adds another blow to the growing trade tension between the EU and Chinawhich already affects multiple sectors, including (and one of the most famous), that of electric cars. What has happened? The European Commission maintains that Chinese tires were entering the community market at artificially low prices, a practice known as dumping, and assures that this has harmed the European industry in the sector, which employs more than 80,000 people in 14 EU countries, according to has explained the institution itself. In detail. Tariffs are not the same for all manufacturers. Shandong Yongsheng Rubber Group, a producer focused on more economical tires, receives the highest tariff45.3%. Another 64 companies (including Chinese factories of brands such as Pirelli, Goodyear, Continental or Sumitomo) will have to pay 24.4%. The most striking case is perhaps that of the South Korean company Hankook, which manufactures in China but has escaped with a tariff of only 4.3%, since its researchers concluded that its tires are sold at much higher prices than those of its Chinese competitors and that their impact on the European market was less. Why does it matter? The European market for tires of this type moved more than 18,000 million euros in 2024, with a consumption of about 330 million units, according to data of the European Commission. Of them, almost 93 million came from China, which represents a market share of 28%, a percentage that has been growing strongly from 18% in 2021, according to collect Carscoops. The Commission itself states that indicators such as sales, employment or profitability of European manufacturers showed “a clear negative trend” during the period analyzed. Between the lines. More than 90% of imported Chinese tires are concentrated in the cheapest segment of the market, the so-called “tier 3”, according to data of the Coalition Against Unfair Tire Imports, the association of European manufacturers that filed the initial complaint. This organization assures that the dumping margins detected ranged between 41% and 104%, and that Chinese prices were below European prices by between 30% and 65%. To calculate whether there was dumping, the Commission needed to compare Chinese prices with reliable “reference” prices. The problem is that, according to Brussels, prices within China do not serve as a reference because the State has too much influence over companies in the sector. Therefore, the Commission has decided to use Turkish prices as a proxy to make that comparison. This decision has not pleased the Chinese producers or the South Korean companies Kumho Tire and Hankook, which they argue that Türkiye is not a valid example either, since it imports steel from Russia. The Commission, however, has rejected this argument and has maintained its choice. What China says. The Chinese Chamber of Commerce before the EU has warned that tariffs could place an additional cost burden on the automotive sector. In a statement Quoted by the South China Morning Post newspaper, the organization points out that tariff differences between manufacturers “may have implications for the competitive position of companies operating in the same market”, including European and Asian companies with plants in China. What does it mean for the pocket? According to calculations According to the German media Automobilwoche, tariffs are applied to the import value of the tire, not its final sales price. In 2024, this average value was 30.30 euros per unit. With the 45.3% tariff, the extra cost would be around 13.70 euros; with that of 24.4%, about 7.40 euros. Adding VAT, the increase for the buyer could be between 9 and 16 euros per tire, before the stores apply their own margins. And everything indicates that the entry segment will be the one that will notice the impact the most. And now what. This measure does not close the chapter between the EU and China in this sector. And there is also a parallel investigation for possible illegal subsidies to Chinese manufacturers, also focused on tires, whose conclusions are expected in December of this year. Citi analysts, cited by SCMP, consider that tariffs can help stabilize the European tire sector and anticipate a positive reaction on the stock market for manufacturers such as Goodyear, Michelin, Continental and Pirelli. Cover image | François Genon and Robert Laursoo In Xataka | The camera that watches you while you drive is already mandatory in new cars. And no one guarantees what happens with that data.