EU and China agree to restrict exports of Chinese hybrids — The Express Tribune
The European Union and China have reached an agreement providing for restrictions on exports of Chinese hybrid vehicles to the EU’s 27 member states. In the first half of the year, exports of such vehicles from China to the European Union tripled to $7.5 billion, compared with $2.5 billion in the same period last year, The Express Tribune reports.
Rapid growth in shipments
According to Chinese customs data, hybrid exports to the EU in the first half of the year were nearly nine times higher than the figure for the whole of 2021, when they amounted to $845 million. After the EU introduced additional tariffs on China-made electric vehicles in 2024, automakers stepped up deliveries of plug-in hybrids to Europe, as these duties did not apply to them.
Investment firm Jefferies estimates that SAIC, BYD and Chery accounted for more than 90% of Chinese hybrid sales volumes in the EU. Hybrid models represented more than half of these companies’ European sales. Research firm Schmidt Automotive Research found that Chinese brands reached a record 15% share of the European electric vehicle market in the second quarter, compared with 9.5% in the first quarter of 2024.
According to Schmidt Automotive Research, the share of Chinese plug-in hybrids in the respective segment of the European market exceeded one quarter, rising from 1.7% at the beginning of 2024.
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Parameters of possible quotas
European Commissioner for Trade Maroš Šefčovič said the agreement would reduce imports by “several million cars over four years.” At the same time, Brussels and Beijing have not yet disclosed the mechanism for implementing the agreement.
China’s Ministry of Commerce said the agreement would allow export growth to continue and would guarantee China a quota no smaller than that granted to any other import source. Citi analysts noted that implementation rules, volume caps, minimum prices and possible exemptions still require technical negotiations.
Production in Europe
Changan President Zhao Fei said at the Paris Motor Show that he was not overly concerned about the agreement. In his view, it could precede rules on the share of localized production in Europe; the company plans to begin producing vehicles in the region early next year.
Analysts also believe that restricting market access through imports could strengthen incentives for Chinese automakers to locate production closer to European buyers. Jefferies described the situation as a reduction in tariff risk while quota risk simultaneously increases.
