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BMW electric Mini threatened with highest EV tariff from EU, source says

BMW Group press conference on investment for the MINI production in the UK

By Christina Amann and Victoria Waldersee

BERLIN (Reuters) - BMW's all-electric Mini made in China is set to be hit by the highest EV tariff of 38.1% under the EU's provisional plans, a source familiar with the matter said on Friday, a potential terminal blow for the mid-range car's sales prospects.

Mass production of the roughly 35,000-euro ($37,345) vehicle, produced by a BMW and China's Great Wall Motor Co Ltd joint venture, began late last year - shortly after the EU launched its probe.

With production still in early days, the JV was unable to fulfil the European Commission's survey to the level of detail required to be classed as a company cooperating with the investigation, the source said, declining to be named because discussions are private.

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Companies seen as cooperating with the EU were subject to lower tariffs of 17.4%-21%, according to a European Commission document seen by Reuters. That includes BMW Brilliance Automotive, another BMW joint venture which has produced the electric iX3 for export to Europe from China since 2021.

BMW declined to comment. BMW CEO Oliver Zipse said earlier this week the tariffs were the "wrong way to go", echoing concerns from other German carmakers fearful of a trade war which could end in counter-tariffs on cars exported from Germany to China.

The European Commission said that joint ventures producing cars in China would be subject to duties, without specifying whether more recently formed ventures might benefit from the lower 21% rate for companies that cooperated with the investigation.

A 38.1% price hike on the Mini, which was to be exported from China to Europe, could dent sales at a time when the carmaker is counting on every projected all-electric sale to help meet tightening carbon emissions targets.

The deadline for imposing provisional measures is July 4, after which the investigation will continue to late October. That leaves time for Beijing and Brussels to make a deal to soften the blow. Companies can also submit comments and request hearings after the provisional duties are applied.

($1 = 0.9372 euros)

(Reporting by Victoria Waldersee, Christina Amann, additional reporting by Phil Blenkinsop in Brussels; editing by David Evans)