The Biden administration is expected to announce new tariffs of up to 100% on Chinese electric vehicles and additional import taxes on other Chinese products, including semiconductors, as early as next week, according to people familiar with the matter.
The move comes amid growing concern within the administration that Biden’s efforts to boost domestic production of clean energy products could be undermined by China, which has been flooding global markets with solar panels, batteries, electric vehicles and other products. cheap.
The long-awaited tariffs are the result of a four-year review of duties that President Donald J. Trump imposed on more than $300 billion in Chinese imports in 2018. Most of Trump’s tariffs are expected to remain in effect , but Mr. Biden plans to go further, raising taxes in areas the president provided subsidies in the Inflation Reduction Act of 2022.
This includes Chinese electric vehicles, which currently face a 25% tariff. The government is expected to increase this amount to up to 100 percent in order to make purchasing a Chinese EV prohibitively expensive.
Biden has previously raised concerns about Chinese electric vehicles, saying Chinese internet-connected cars and trucks posed national security risks because their operating systems could send sensitive information to Beijing. He took steps earlier this year to try to stop these vehicles from entering the United States.
The president intends to increase pressure on China and demonstrate his willingness to protect American industry before his confrontation with Trump in November’s presidential elections.
The fate of tariffs on China has been the subject of intense debate in the White House since Biden took office, with economic and political advisers often clashing over how to proceed. But this year China began to increase production of the same products – electric vehicles, lithium batteries and solar panels – that the Biden administration has invested billions of dollars to begin producing in the United States. Beijing’s move once again inflamed trade tensions between the two countries, forcing Biden to pursue more aggressive trade restrictions.
Trump has said he would escalate his trade war with China if re-elected and said this year he was considering imposing tariffs of 60% or more on Chinese imports. In March, Trump said he would impose a 100% tariff on cars made in Mexico by Chinese companies.
The scale of the Biden administration’s tariffs, which are expected to be applied to Chinese electric vehicles, batteries and solar products, is unclear. New tariffs on Chinese electric vehicles are not expected to apply to traditional gasoline-powered cars made in China, according to a person familiar with the plans.
The planned release of the review, which is being led by the Office of the United States Trade Representative, was previously reported by Bloomberg News.
The strategic tariffs are also expected to include new taxes on semiconductors, which Biden sought to boost in the bipartisan CHIPS and Science Act, a 2022 law that includes subsidies and other incentives for chipmakers.
Some Democrats, including Sen. Sherrod Brown of Ohio, have been urging the Biden administration to take more drastic action to protect the U.S. auto industry. Last month, Brown called for Chinese electric vehicles to be banned in the United States, arguing they pose an “existential threat” to American automakers, and on Friday he said import duties were insufficient.
“Tariffs are not enough,” Brown wrote on social media platform X. “We need to ban Chinese electric vehicles from the US. Period.”
Biden said last month that he was asking the trade representative, as part of the review, to also increase tariffs on imported steel and aluminum products from China. The president and his advisers have accused the Chinese of selling heavy metals at artificially low prices around the world in order to gobble up market share to the detriment of American producers.
“My U.S. trade representative is investigating the Chinese government’s trade practices regarding steel and aluminum,” Biden told steelworkers in Pittsburgh, referring to Katherine Tai, who heads the office. “If this investigation confirms these anti-competitive trade practices, then I ask you to consider tripling tariff rates on both steel imports and aluminum imports from China.”
The president added: “I’m not looking for a fight with China. I look for competition – and fair competition.”
The U.S. solar industry has also been lobbying the Biden administration to impose new tariffs on Chinese imports, as an influx of cheap solar panels and components has caused prices in that sector to fall by about 50 percent over the past year. Last month, a group of seven major solar manufacturers filed trade complaints formally requesting that the Biden administration impose tariffs on solar products imported into the United States from Southeast Asia, where Chinese companies have relocated their operations to avoid existing tariffs. .
“We are hopeful that the tariff review will be done with the goal of aligning tariffs with strategic priorities, including the continued buildout of domestic solar production,” said Michael Carr, executive director of the Solar Energy Manufacturers for America coalition.
The prospect of the United States imposing new tariffs on China was criticized in Beijing on Friday. Chinese Foreign Ministry spokesman Lin Jian said the Trump administration’s tariffs “severely disrupted normal trade and economic exchanges between China and the US” and argued that they violated World Trade Organization rules. .
“Instead of ending these wrong practices, the US continues to politicize trade issues, abuse the so-called Section 301 tariff review process and plan tariff increases,” Lin said, referring to the legal provision that Washington is to use to justify tariffs. “China will take all necessary measures to defend its rights and interests.”
In 2020, during the Trump administration, the United States and China agreed to a comprehensive “Phase 1” trade agreement that allowed each of the two countries to review their bilateral tariffs after four years. That bilateral agreement remains in force, but the United States delayed the outcome of its review when the four-year mark was reached in January.
This pact likely gives Washington freedom to raise tariffs. Beijing never met that agreement’s specific targets for Chinese imports of American manufactured goods, initially citing the onset of the pandemic. Subsequently, it followed a policy of replacing imports with domestic production.
Greta Peisch, a former general counsel in the office of the U.S. trade representative who helped oversee the Biden administration’s trade investigation, noted that the European Union was also considering new tariffs on imports of Chinese electric vehicles, and that Washington’s anticipated action it was the result of China’s persistently aggressive trade policies. Without higher tariffs, she said, the U.S. auto sector will not be able to compete with heavily subsidized Chinese electric cars.
“When we look at the impact of China’s long-standing policies on EVs, we see that they are producing much more and have much more capacity than they can absorb,” said Ms. Peisch. “You really want to go up enough to make sure you’re bucking the trend that we’re seeing.”
Keith Bradsher contributed reports.
