How a U.S.-China Tariff Truce Lowers Battery Import Costs

Background of the U.S.-China Tariff Truce

The roots of U.S.-China trade tensions trace back to 2018, when the U.S. accused China of unfair practices in technology transfer and intellectual property protection, citing China’s “Made in China 2025” plan. In July 2018, the U.S. imposed tariffs of 10%-25% on Chinese goods, which later escalated. In January 2020, tariffs on lithium batteries and related products rose from 7.5% to 15%, and by May 2024, they increased to 25%.

This policy significantly affected the battery industry in both countries. China, the world’s largest lithium battery producer, exported $61.12 billion worth of batteries in 2024, accounting for nearly 60% of the global market.

The tariff truce in May 2025 resulted from multiple factors. In late 2024, U.S. demand for low-cost batteries surged due to growth in the EV and energy storage sectors. In April 2025, spurred by the Global Climate Change Conference, U.S. and Chinese leaders held informal talks in Beijing.

From May 6 to 14, 2025, delegations met in Geneva for nine days of trade talks focused on energy technology cooperation and tariff relief. On May 14, they signed the U.S.-China Geneva Trade Talks Joint Statement, pledging to pause new tariffs for six months and reduce lithium battery tariffs from 25% to 10%.

How the Tariff Truce Lowers Battery Import Costs

1. Direct Cost Savings: For a 10 kWh EV battery pack, reducing tariffs from 25% to 10% saves $750 per unit. This not only cuts individual transaction costs but could also drive down market prices through economies of scale.
2. Improved Supply Chain Efficiency: From January to February 2025, China’s lithium battery exports grew 11.4% year-over-year to $9.72 billion, reflecting smoother supply chains.
3. Market Price Trends: Analysts predict lithium battery prices could drop 5%-10% in the next six months, boosting demand.

Other Factors Affecting Battery Import Costs

1. Exchange Rates and Raw Material Prices: Lithium and cobalt prices rose slightly in early 2025, and importers should monitor these indirect costs.
2. Policy Uncertainty: The truce is temporary. For context, solar panel exports in 2024 fell 29.2% due to tariff impacts.
3. Logistics and Customs Efficiency: Surging demand may clog customs processes. Planning clearance in advance is key to minimizing costs.

How to Choose Cost-Effective Imported Batteries

1. Evaluate Brand and Quality: Opt for trusted brands with certified capacity and safety standards to ensure performance.
2. Compare Prices and Services: Select suppliers offering warranties and support to reduce long-term risks.
3. Adopt Flexible Procurement: Start with small batch purchases to test market response and capitalize on truce-driven price advantages.

Future Outlook for Lower Battery Import Costs

The tariff truce offers a bright spot for the lithium battery industry but comes with challenges. In the short term, lower costs will likely drive demand, with the U.S. energy storage market projected to grow 20% in 2025. In the long term, sustained U.S.-China dialogue could stabilize supply chains and further reduce battery prices. However, intensifying global competition and technological advancements demand continuous innovation from businesses.

The truce is more than an economic signal—it’s a starting point for market transformation. It delivers more affordable battery products to consumers and opens new opportunities for businesses. Are you ready to seize this moment and optimize your battery procurement strategy?

HIMAX is an online brand specializing in lithium battery sales, dedicated to providing high-performance EV and energy storage battery solutions globally. Our products leverage advanced technology, offering stable capacity and long cycle life.

Frequently Asked Questions

1. How long will the U.S.-China tariff truce last? Per the joint statement, the truce is set to last six months, from May 14, 2025, to November 14, 2025, though this may adjust based on future negotiations.
2. How much will the truce impact EV battery prices? For a 10 kWh battery pack, savings could reach $750 per unit, with prices potentially dropping an additional 5%-10%.
3. Should I bulk-buy lithium batteries right after the truce? Avoid large-scale purchases initially. Start with small batches to gauge market trends and policy stability.
4. Will the truce affect battery quality? The truce doesn’t directly impact quality, but competition may drive manufacturers to enhance products. Choose certified brands for reliable performance.
5. How can I handle potential customs delays post-truce? Plan customs clearance early and partner with experienced logistics providers to keep your supply chain smooth.