Shares of Chinese EV makers slide after EU probe into subsidies
investing.comBy Donny Kwok and Brenda Goh
HONG KONG/SHANGHAI (Reuters) -Hong Kong-listed shares of Chinese electric vehicle (EV) makers fell on Thursday after the European Commission launched an investigation into Chinese subsidies for EVs, escalating tensions between Beijing and the EU.
European Commission President Ursula von der Leyen announced the investigation in her annual address to lawmakers on Wednesday, saying: «Global markets are now flooded with cheaper electric cars. And their price is kept artificially low by huge state subsidies.»
Analysts said the probe could slow capacity expansion and the capital spending cycle of China's battery suppliers, although the move should not pose a big downside risk for Chinese EVs.
Hong Kong shares of market leader BYD (SZ:002594) fell more than 3%. Smaller rivals Xpeng (NYSE:XPEV) and Geely Auto dropped 0.6%, while Nio (NYSE:NIO) slid 2%. Shanghai-listed shares of state-owned car giant SAIC fell as much as 3.4%.
Nio and Geely declined to comment on the EU probe, while BYD, Xpeng and SAIC did not respond to requests for comment.
The Shenzhen-listed shares of battery maker CATL fell more than 1%. CATL did not respond immediately to a request for comment.
STRAINED RELATIONS
The anti-subsidy probe, initiated by the European Commission and not from any industry complaint, is set to further irritate an already strained relationship with China.
Ties have become tense due to Beijing's ties with Moscow after Russian forces swept into Ukraine, and the EU push to rely less on the world's second-largest economy and also its No.1 trading partner.
In his meeting with the commission's von der Leyen on the sidelines of the G20 Summit in New Delhi on Saturday, Chinese Premier Li Qiang urged the
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