via scmp:
The European Union will launch a new investigation into China’s subsidies of cheap electric vehicles, risking a potential trade war with the world’s second-largest economy.
European Commission president Ursula von der Leyen made the announcement during Wednesday’s State of the EU address, an annual speech laying out the bloc’s policy priorities for the year ahead, in which Beijing featured.
It comes amid fears in Europe that Chinese industrial policy is undermining its efforts to compete in innovative sectors.
“Global markets are now flooded with cheaper Chinese electric cars and their prices kept artificially low by huge state subsidies. This is distorting our market,” von der Leyen said.
She compared China’s electric vehicle push to the solar industry, which China has dominated for more than a decade, leading to a huge trade dispute with Brussels.
“We have not forgotten how China’s unfair trade practices affected our solar industry. Many young businesses were pushed out by heavily subsidised Chinese competitors, pioneering companies had to file for bankruptcy,” von der Leyen said.