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Reporter of China Business Network: Duan Siyao Editor of China Business Network: Pei Jianru

According to the Ministry of Commerce website, on August 23, the Ministry of Commerce held a meeting to listen to the opinions and suggestions of industry experts on raising tariffs on large-displacement fuel vehicles. Representatives of relevant industry organizations, research institutions and automobile companies attended the meeting.

In an interview published in May, the Global Times newspaper said Liu Bin, chief expert at the China Automotive Technology and Research Center, called for a temporary increase in tariffs on cars with engines larger than 2.5 liters. The report quoted Liu as saying that China imported 250,000 such cars last year, and World Trade Organization rules allow tariffs of up to 25%.

Later, according to CCTV News, at a regular press conference held by the Ministry of Commerce, the Ministry of Commerce spokesperson He Yadong said: "China is determined to follow the path of green and low-carbon development, and has always encouraged and supported various industries to transform and upgrade in the direction of green and low-carbon and achieve high-quality development. Experts in various fields, including the automotive industry, are also conducting research on this and making suggestions for addressing global climate change."

"I would like to emphasize that some countries and regions are currently deviating from the concept of green development, violating the principles of market economy and WTO rules, and have introduced some restrictive measures in the field of new energy vehicles. We believe that these measures will only harm the interests of their own consumers and affect global green transformation and efforts to address climate change," said He Yadong.

It is reported that the current price of imported cars in China is mainly composed of five parts: landed price (foreign bare car price), tariffs, consumption tax, value-added tax and dealer fees (including vehicle transportation costs, commodity inspection fees, port warehousing fees, license fees, and dealer profits).

Among them, my country's tariff rate for imported cars is about 15%, and the consumption tax is a tiered tax rate, which is determined according to the displacement. For example, the tax rate for passenger cars with a cylinder capacity of 2.0 liters to 2.5 liters (including 2.5 liters) is 9%; the tax rate for cylinder capacity of 2.5 liters to 3.0 liters (including 3.0 liters) is 12%; the tax rate for cylinder capacity of 3.0 liters to 4.0 liters (including 4.0 liters) is 25%; the tax rate for cylinder capacity of 4.0 liters or more is 40%.

Data from the China Passenger Car Association shows that in the first seven months of this year, my country imported 119,200 gasoline passenger cars with a fuel consumption of 2.5 liters and above, accounting for more than 30% of all passenger car imports.

At present, China's passenger car importers are still mainly Japan, Europe and the United States. Taking European countries as an example, in 2023, European countries' exports of passenger cars with a capacity of more than 2.5 liters to China reached 196,000 units, a year-on-year increase of 11%; from January to July 2024, this number reached 88,000 units, a year-on-year decrease of 20%, of which the import volume in July was 19,000 units, a year-on-year increase of 33%.

Specifically, in the first seven months of this year, Germany's exports of passenger cars with a displacement of 2.5 liters or above to China were the highest, reaching 34,000 units; Slovakia ranked second with an export volume of 27,000 units; and the United Kingdom ranked third with an export volume of 19,000 units.

In terms of import value, in 2023, European countries' exports of passenger cars with a displacement of 2.5 liters or above to China reached 196,000 units, with an import value of US$17.9 billion, a year-on-year increase of 3%; from January to July 2024, the import value reached US$8.4 billion, a year-on-year decrease of 18%, of which the import value in July was US$1.9 billion, a year-on-year increase of 44%.

Cui Dongshu, secretary general of the National Passenger Car Market Information Joint Conference, said: "As China's auto industry continues to grow stronger, the electrification transformation has changed the market demand structure, the demand for fuel vehicles has continued to shrink, and the demand for imported fuel vehicles has also declined significantly. As international relations continue to become more complex, we still need to prepare for a rainy day and establish more import models to maintain a reasonable scale of imported vehicles."

Daily Economic News