Tesla has deals to sell credits to European carmakers who are still selling gasoline-powered vehicles so they can avert huge fines

Automakers in Europe are facing tougher emissions rules this year, and face cumulative fines amounting to $15.6 billion if they fall short of targets

As Donald Trump tests America's ties with some of its closest allies, China is quickly emerging as the West's hedge against his tariff threats

China is currently the world’s dominant supplier of clean technologies, and the EU has been uneasy over its dependence on Beijing for them

Despite stalled talks between both the sides, it is unlikely that Beijing would want to torpedo its ties with the EU given its trade with the US is already hurt by geopolitics

The directive comes as, starting Wednesday, Chinese electric vehicles heading to Europe will be subject to tariffs as high as 45.3%

The agency expects carmakers to continue working towards making cheaper and innovative EVs — with China firmly in the lead. It also predicts a hit to Europe’s GDP from the EV transition

The EU is attempting to hold talks with some EV-makers outside of official channels, shaking “the foundation and mutual trust of the negotiations,” Beijing says

The European Commission looks to have gathered enough support for its planned tariffs to go through, despite pushback from major automakers and key bloc members

Technical talks with China had intensified to an almost daily basis and could extend beyond the end of October, a top European Commission official said

China and EU have both vowed to intensify efforts to avert the tariffs, amid concerns that could trigger a 'trade war' between the economic powerhouses

The planned tariffs, if approved by the EU's 27 members, will potentially raise prices for consumers at a time when the region's EV sales have plunged 44%