The UK could be set to investigate whether its electric vehicle market is being flooded with cheap Chinese EVs and whether that will destroy domestic manufacturing.
The Department for Business and Trade has discussed intervening, as concerns grow that Beijing has given its car producers an unfair edge through huge subsidies.
The EU has already launched a similar investigation, and the United States has issued China a warning against saturating foreign markets with EVs.
In response, Beijing has threatened retaliation against products coming from the West.
A car industry source told Politico this week that “the wheels had started turning” on a possible UK investigation.
Officials are said to be looking at “what those options might look like”.
It’s possible that tariffs may come off the back of an investigation, should investigators conclude that Chinese firms have been benefiting from anti-competitive support from Beijing.
Labour has backed the plan, with shadow business secretary Jonathan Reynolds saying the UK should be prepared to institute “trade remedies”, if Chinese companies have been given an unfair advantage.
Mr Reynolds was quizzed on the issue during the MakeUK manufacturers conference on Tuesday.
He said: “There are some sectors where I look at just the sheer overcapacity that’s coming out of China and I worry that is inconsistent with how a healthy, global market economy should operate.
“Where there is a concern that we’re not facing free and fair and healthy competition, we’re right to use trade remedies as an answer to that.”
At present, Chinese EVs like those produced by BYD and MG are comparatively cheaper than rival European models and Renault has warned of an “invasion” of EVs distorting continental markets.
A Department for Business and Trade (DBT) spokesman said: “No request for an investigation has been made to DBT, but car manufacturers should formally raise any concerns with the Trade Remedies Authority before one is considered.”
