German transport minister rejects punitive tariffs in EU’s China EV probe

BERLIN (Reuters) – German Transport Minister Volker Wissing has rejected possible punitive tariffs as a result of the European Commission’s investigation into Chinese electric vehicle (EV) subsidies.

“In principle, I don’t think much of erecting market barriers,” Wissing told the Monday edition of the Augsburger Allgemeine newspaper.

Such isolationist politics could spark a chain reaction that would massively damage the German economy, said Wissing.

“Today cars are sealed off, tomorrow chemical products, and each individual step in itself makes the world poorer,” said Wissing, from the business-friendly Free Democrats (FDP).

“We have to make sure that we produce our electric vehicles competitively – for Germany and for the world markets,” he added.

European Commission President Ursula von der Leyen this month announced a probe into whether to impose punitive tariffs to protect EU automakers against China’s EV imports, which the commissions says are benefiting from excessive state subsidies.

China blasted the probe as protectionist and warned that it would damage economic relations, a concern shared by Germany’s car industry.

German Economy Minister Robert Habeck, by contrast, has welcomed the step, saying action must be taken if massive breaches of competition rules are found by the EU probe.

(Reporting by Miranda Murray, Editing by Friederike Heine)