The prospect of European tariffs cut 20-30 percentage points off China’s growth in exports of electric and plug-in hybrid cars in recent months, an official at a leading Chinese auto industry body reportedly said on Monday.

Last week, the European Union introduced provisional tariffs of up to 37.6% on China-made electric vehicles (EVs) to safeguard against what it described as a potential flood of unfairly subsidised EVs, a move China strongly opposed, Reuters reported.

“New energy vehicle exports currently face temporary pressure,” Cui Dongshu, secretary general at the China Passenger Car Association (CPCA), reportedly said.

“Our (NEV export) growth used to be at least 30 40% and it has slowed to only more than 10%, meaning (the tariffs) had a 20-30 percentage point impact on (NEV export growth), a conspicuous short-term impact,” Cui added.

Reuters said he was speaking after the CPCA reported China’s domestic car sales fell for the third month running in June.

The report said NEV exports rose 12.3% year on year in June but were down 15.2% from May with NEV exports accounting for 21% of total car exports, down three percentage points from June 2023.

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Reuters noted Tesla exports of China made EVs in April-June fell to the lowest level since the third quarter of 2022 when its Shanghai factory operations were largely suspended during a Covid lockdown. Europe is the largest export market for Tesla EVs made at the Shanghai plant.

The report added China’s total car exports for June rose 28% year on year following a 23% gain in May, underpinned by robust ICE car shipments, according to the CPCA.

Domestic sales fell 6.9% in June, dropping for a third straight month as government incentives failed to spur consumer demand in a sputtering economic recovery.

Passenger vehicle sales totalled 1.78m with the pace of decline picking up from a 2.2% drop in May and a 5.8% fall in April, Reuters added.