XPEV - Fresh EU Tariffs Could Slow Down Tesla Chinese Rivals But Warren Buffett-Backed BYD 'Can Profitably Export Even At A 35% Tariff' Says Expert | Benzinga
The European Union has introduced new tariffs on electric vehicles manufactured in China, a move that could pose challenges for Chinese automakers. However, companies like Warren Buffet-backed BYD (OTC:BYDDF) (OTC:BYDDY) are expected to remain competitive, according to experts.
What Happened: The European Commission announced on Wednesday that it will impose provisional tariffs on Chinese EVs from July, citing China’s “unfair” use of state support. Definitive measures are expected to be confirmed by year-end, reported by Nikkei Asia on Thursday.
State-owned SAIC Motor faces the highest additional tariff of 38.1%, while BYD has received the lightest rate at 17.4%. Geely Automobile Holdings faces a 20% additional tariff. These tariffs are on top of the EU’s existing 10% tariff on Chinese EV imports.
However, BYD’s shares in Hong Kong surged nearly 9% at one point on Thursday morning following the news.
“BYD’s cost advantage is high enough that they can profitably export even at a 35% tariff,” said Eugene Hsiao, head of China autos at Macquarie Capital.
Buffett’s Berkshire Hathaway Inc. is an investor in BYD. ...