China’s state support for electric carmakers is being investigated by the European Union as soaring imports threaten European manufacturers.

Ursula von der Leyen, president of the European Commission, told the European Parliament on Wednesday that Europe is open to competition, but “not for a race to the bottom.”

“Global markets are now flooded with cheaper electric cars, and their prices are artificially kept low by huge subsidies from the government,” von der Leyen said. In light of this, I am announcing today that the Commission will launch an anti-subsidy investigation into Chinese electric vehicles.”

The European Union imposes a 10% duty on cars imported from China. Comparatively, the United States has a duty of 27.5%, and China’s manufacturers have seized the opportunity to dominate the European market.

According to the China Passenger Car Association, Chinese companies exported more electric vehicles to nine European countries in the first half of the year than they did in all of 2022. The number of Chinese cars imported into the European Union has quadrupled in the last five years.

According to a recent estimate by UBS, Chinese carmakers could see their market share double by 2030 to 33%, with European firms losing the most share.