China is investigating whether to raise tariffs on European large-engine vehicles and will start collecting levies on brandy, escalating a trade spat after the European Union decided to impose tariffs on Chinese electric vehicles.

German Chancellor Olaf Scholz's rejection of EU tariffs on Chinese electric vehicles failed to stop fellow European Union members voting in favour, exposing how a divided Berlin is struggling to drive EU policy.

China has imposed anti-dumping policies on EU brandy following the bloc's vote to impose tariffs on Chinese EVs last week. The move is being seen as a retaliatory measure and could fuel fears that a US-style trade war with China has arrived in Europe.

The EU conformed its decision to raise tariffs on Chinese EVs, leading to worries this might raise trade tensions.

STORY: Trade tensions between China and the European Union ramped up again on Tuesday (October 8).Beijing imposed temporary anti-dumping measures on brandy imports from the bloc.The move hits top spirits brands like Hennessy and Remy Martin.

Hungarian Prime Minister Viktor Orban slammed the European Union for what he said was a failure to take into account the interests of the continent’s car industry in setting environmental goals.

German Chancellor Olaf Scholz's rejection of EU tariffs on Chinese electric vehicles failed to stop fellow European Union members voting in favour, exposing how a divided Berlin is struggling to drive EU policy.

The European Union is bracing for retaliation from China after the bloc voted last week to impose tariffs on the import of Chinese electric vehicles, or EVs, amid speculation that Beijing could seek to target individual European countries that voted for the measures.

Ten EU member countries voted in favor of tariffs on Chinese-made electric vehicles while five opposed them. Germany, Europe’s largest economy, voted against the tariff hikes, raising concerns about potential trade retaliation.