Carlos Tavares, CEO of Stellantis, said on Wednesday that a fierce battle with Chinese electric vehicle competitors is expected in the European market, foreseeing significant social consequences as a result.
Tavares stated that imposing tariffs on Chinese cars imported to Europe and the United States is a "major trap", which will not only force Western automakers to restructure in response to low-cost Chinese manufacturers but also exacerbate inflation.
He noted that tariffs would only drive up inflation in regions where they are implemented, affecting sales and production.
"We are not talking about a Darwinian period; we are already in it," Tavares said at the Reuters Automotive Summit in Europe, adding that the price war with Asian competitors will be "very tough."
The European Commission will announce a preliminary decision on potential tariffs on Chinese electric vehicle imports on June 5, while the US has stated it will impose a 100% tariff on Chinese electric vehicles to ban their import. In response, China has threatened retaliatory tariffs.
"When you are competing against rivals with a 30% cost advantage, there will be social consequences. But governments, especially European ones, are currently unwilling to face this reality."
