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Home » EU Targets Tesla’s Chinese Exports in Probe of Potential EV Subsidy Imbalance

EU Targets Tesla’s Chinese Exports in Probe of Potential EV Subsidy Imbalance

Canaccord Genuity just cut his price target on $TSLA from $267 to $234

The European Union has launched an anti-subsidy investigation that will examine exports of electric vehicles from China to the EU, including Tesla’s locally-produced cars according to top trade officials.

The European Commission aims to determine whether China’s EV industry is benefiting from unfair government subsidies and support that disadvantage European automakers.

The Financial Times reported that Tesla’s Shanghai-made cars bound for Europe will fall under the probe’s scrutiny, along with EVs produced in China by European manufacturers.

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This represents a substantive escalation as the EU becomes increasingly concerned with lopsided competition from Chinese rivals in green tech and EVs.

However, it’s unclear if Tesla actually utilizes China’s export rebate incentives that are central to the dispute. Tesla’s financials do not appear to reflect subsidies tied to exports.

The inclusion of Tesla models built in China also signals a notable shift – previously, European concerns centered on support for domestic Chinese brands. Targeting American EV leader Tesla signals a broader view of potential imbalance.

With European automakers racing to ramp EV production, the EU appears determined to ensure manufacturers compete on even ground without geographic advantages. That will put Chinese exports squarely under the microscope.

For Tesla and others exporting EVs from China to Europe, the investigation raises risks of retaliatory tariffs if evidence of subsidy imbalance emerges. But the probe is still in early phases as the EU gathers data.

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