Jonathan Reynolds is considering whether to impose tariffs on Chinese electric vehicles as imports surge to record levels across the UK.
Ministers are concerned that Chinese carmakers are “dumping” subsidised vehicles into the British market, undercutting domestic and European manufacturers on price.
The government is reportedly examining whether to adopt the 45 per cent tariff already levied on Chinese cars by the European Union.
“We continue to engage closely with industry so that our approach reflects the sector’s and UK’s national interests,” a government spokesperson said.
Andy Burnham is also understood to be under pressure from the EU to impose tariffs on Chinese EVs if the UK wishes to be treated as a “trusted partner” under its new “Made in Europe” policy.
The EU initiative aims at reducing imports into Europe and encouraging more European-made goods, with British carmakers worried they could be shut out of the scheme entirely.
Industry leaders fear exclusion from the policy could set new barriers to the supply of crucial parts and equipment across the Channel, disrupting established manufacturing supply chains.
More than 300,000 Chinese cars have been sold in the UK so far this year, setting a fresh record as European rivals lost significant ground in the market.
Chinese carmakers made up five of the top 25-performing brands in the first nine months of the year, accounting for just under a quarter of the market by volume, according to the Society of Motor Manufacturers and Traders.
MG, the heritage British marque bought by Chinese owners in 2006, was the best-performing Chinese brand in the UK, racking up just shy of 80,000 registrations.
BYD followed in second place with 68,000 registrations, while Jaecoo came third with 59,000 units sold across the same period.
Jaecoo also produced the single best-selling model in the UK during September, with more than 10,000 units of its ‘7’ SUV sold in that month alone.
Chinese carmakers, all of whom only sell electric vehicles in the UK, were well positioned to capitalise on a broader consumer shift away from petrol and diesel cars amid rocketing fuel prices.
Plug-in hybrid registrations surged 55.7 per cent to take a record volume and market share of 17.0 per cent during the period under review.
Battery electric vehicle demand climbed 36.3 per cent in September to a record high volume of just under 100,000 units, with market share rising five percentage points to 28.3 per cent.