EU confronts Chinese subsidies with electric car probe

Brussels will investigate Chinese state subsidies for electric cars, the EU chief said.

Brussels will investigate Chinese state subsidies for electric cars, the EU chief said Wednesday, vowing to defend Europe's industry from unfair competition.

The move is a victory for France which has expressed concerns that Europe will fall behind during the green transition if it is not more assertive when confronted with China's alleged protectionism.

But some EU member states, including Germany, are wary of angering Beijing, since they rely on trade relations with China, although Berlin welcomed the probe Wednesday.

European Commission president Ursula von der Leyen announced the anti-subsidy investigation, vowing to defend Europe's manufacturers.

"Global markets are now flooded with cheaper Chinese electric cars. And their price is kept artificially low by huge state subsidies," von der Leyen said, during a speech at the European Parliament in Strasbourg.

The probe could lead the European Union to impose duties on those cars that it believes are unfairly sold at a lower price, thereby undercutting European competitors.

"Europe is open for competition but not for a race to the bottom," the European Commission president said.