China, EU agree to negotiate further on EV tariffs, see rise in electric vehicle stocks

Officials from China and the European Union (EU) have agreed to engage in further discussions regarding tariffs on electric vehicles, leading to an increase in electric vehicle stocks.

Shares of XPeng Motors (9868) surged over 8%, NIO Inc. (9866) rose more than 2%, and BYD Company Limited (1211) increased by over 1%.

Previously, China proposed a price commitment to the EU, hoping to exchange controlled export prices and quantities for the EU's agreement not to implement new tariffs. The EU stated that the solutions provided by China were unacceptable.

Valdis Dombrovskis, the European Trade Commissioner, described his talks with China's Minister of Commerce Wang Wentao as productive. Both parties plan to continue negotiations without affecting the EU's ongoing investigation and its deadlines.

Olof Gill, a spokesperson for the European Commission, stated that the Commission has clearly communicated to China that it will continue its formal investigation into China's unfair trade practices. However, both sides agreed to revisit the price commitment.

The Chinese Ministry of Commerce announced in a statement that discussions on a possible price commitment agreement would continue and both parties are committed to reaching a mutually acceptable solution. The Ministry added that necessary measures would be taken to respond to any tariff actions.

The EU plans to vote on Sept. 25 on whether to impose additional tariffs on electric vehicles from China. Unless opposed by 15 member states (representing 65% of the EU population), the vote will facilitate the implementation of new tariffs for a period of five years starting in Nov.

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