BEIJINGBRUSSELS, May 29 Reuters The European Commission39;s expected move to hike tariffs on Chinese electric vehicles is set to kick off a round of talks that Chinese executives hope will soften the blow for the world39;s biggest EV industry.

The provisional tariffs, expected to be announced by June 5, will be a sticker shock representing billions of dollars in new costs for Chinese electric car makers.

But both Europe and China have reasons for wanting to strike a deal.

Chinas EV industry needs profitable exports to the world39;s thirdlargest economy to counter falling margins at home, while German automakers want access to China39;s auto market and EV partnerships to drive costs down.

Every additional 10 in European Union tariffs on top of the existing 10 levy would cost China39;s EV exporters about 1 billion based on 2023 trade data. That cost will grow this year as Chinese EV makers expand exports to Europe.

Past EU subsidy investigations on imports from China of other products have resulted in extra duties ranging from about 9 to 26 for companies cooperating with the investigation. Analysts see EV tariffs broadly in that range. The duties would be imposed from early July but could apply retroactively for the three prior months.

China has signalled it is readying alternatives for the bargaining ahead. The EU provisional duties could be challenged, or even dropped if a large enough share of EU governments oppose them after four months.

The China Chamber of…