China denounces Europe probe of EVs as 'naked protectionist' act

BEIJING (Reuters) -A European Commission investigation into Chinese electric vehicles believed to have benefited from state subsidies will have a "negative" impact on economic and trade ties, China's commerce ministry warned on Thursday.

The investigation launched on Wednesday will determine if punitive tariffs are warranted to protect EU producers from what European Commission President Ursula von der Leyen described as a "flood" of cheaper Chinese EV imports.

"China believes the investigative measures proposed by the European Union are in reality to protect its own industry in the name of 'fair competition'," the commerce ministry said in a statement.

"It is a naked protectionist act that will seriously disrupt and distort the global automotive industry and supply chain, including the EU, and will have a negative impact on China-EU economic and trade relations."

The probe, initiated by the European Commission and not from any industry complaint, will further irritate a tense relationship with China partly strained by trade and investment imbalances.

In 2022, China's exports to the EU rose 8.6% to $562 billion, according to Chinese customs data. But imports from the EU slumped 7.9% to $285 billion due to weaker Chinese demand and sharply widened the EU's trade deficit with China for the second year.

(Reporting by Ryan Woo; additional reporting by Ellen Zhang; Editing by Clarence Fernandez and Jamie Freed)