Shares of Chinese electric vehicle maker LEAPMOTOR took a sharp dive on Wednesday, plummeting 5% as the European Commission announced plans to impose heavy additional tariffs on imported EVs from China.
The proposed tariffs aim to counter alleged subsidies provided to Chinese automakers. On top of the EU's standard 10% import duty for cars, LEAPMOTOR faces an additional 20.7% tariff under the "Other companies the Commission said cooperated" group. Other Chinese EV giants like BYD and Geely face even steeper tariffs of 17% and 18.8%, respectively.
The tariffs could severely undermine LEAPMOTOR's competitiveness in the crucial European market, making its EVs significantly more expensive for consumers. As the company expands its global footprint, a slowdown in European sales due to higher prices could weigh heavily on its overall revenue and profitability.
Investors reacted swiftly to the news, sending LEAPMOTOR's shares tumbling as concerns mount over the potential impact on the company's growth trajectory and financial performance. The stock's plunge reflects the market's skepticism about LEAPMOTOR's ability to navigate these trade barriers effectively.
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