A perspective on the evolving plug-in electric vehicle landscape amid trade tariffs and strategic responses

Abstract

Various explanations have been put forward for the recent slowdown in global plug-in electric vehicle (PEV) sales growth. Additionally, considerable uncertainty remains regarding future PEV adoption rates, given evolving consumer adoption incentives and newly announced Western tariffs on Chinese PEV imports. This study offers an expert opinion-based perspective on how the PEV landscape may evolve amid ongoing policy and market shifts. In particular, we survey PEV experts in the U.S., Germany, and China to explore (i) reasons behind Western tariffs; (ii) the potential strategic responses of Chinese and Western policymakers and automakers, and (iii) how the PEV market might evolve in the coming years given the global landscape. The surveyed experts attribute the recent slowdown in global PEV sales share growth to technological factors and a consumer preference for hybrids. They view Chinese automakers' expansion into western PEV markets as primarily driven by profit and market share considerations and less so by domestic factors. Experts anticipate that the tariffs will moderately reduce the price competitiveness of Chinese PEVs in the West and that China will likely seek ways to circumvent the tariffs. Additionally, they believe China's likely response will involve tariffs on non-vehicle goods and restrictions on partnerships within China. Rather than trade policies, experts identify the changing stringency of existing emissions regulations as the main non-technological factor expected to influence global and regional PEV sales shares in the coming 3–5 years. We find evidence of variation in expert opinions based on region of focus (China versus U.S./Germany).