Türkiye imposes 40% tariffs on Chinese vehicles after Beijing’s resistence to Ankara’s demands

Türkiye will impose an additional 40% tariff or a minimum customs duty of $7,000 on Chinese-made automobiles effective July 7, 2024, as outlined in the Presidential Decree, published on the official gazette Saturday.

This new policy covers all motor vehicles, including internal combustion engine cars, electric vehicles, tractors, bicycles, motorcycles and their parts and accessories under Chapter 87 of the Customs Tariff Statistical Position (GTIP) list.

Encouraging domestic production

This measure is part of a broader effort to encourage domestic production and reduce the trade deficit.

However, whether Türkiye’s move to impose tariffs is purely economic or geopolitically motivated remains a matter of debate.

This change follows similar moves by the U.S., which recently increased tariffs on Chinese-made electric vehicles and solar cells.

On the other hand, Türkiye has received requests from Chinese companies to set up factories, but no progress has been made on this issue. This situation is also believed to have influenced the recent decision to impose 40% tariffs on Chinese vehicles.

In response to these global tariffs, Chinese companies are increasingly setting up production facilities outside China to bypass trade barriers, yet they remain heavily reliant on domestic sales.

Furthermore, the decision comes after Foreign Minister Hakan Fidan’s recent visit to China and Türkiye’s recent expression of interest in joining BRICS.

While the intent is to boost local manufacturing, representatives from the automotive sector caution that the increased tariffs may lead to higher consumer prices and reduced market share for Chinese brands in Türkiye.

This significant policy shift could reshape consumer preferences, potentially altering the competitive landscape of the Turkish automotive market.