Archive · 19 Dec 2025
Chinese Cars Outmaneuver EU Tariffs with Hybrids
The European Union tried to stop Chinese electric cars from coming in by making them more expensive.
But Chinese car companies found a clever way around this rule.
Instead of selling only electric cars, they started selling more hybrid cars, which have both electric and petrol engines.
This way, they didn't have to pay the extra taxes.
The number of hybrid cars from China sold in Europe went up a lot, and Chinese car companies are even starting to make cars right inside Europe to avoid the taxes.
Now, European leaders are not sure what to do next to stop these Chinese cars from coming in.
Chinese car exports to Europe rose by 26% in the 12 months to November 2024, despite EU tariffs on EVs.
Chinese carmakers shifted focus from EVs to hybrids, with hybrid exports surging by 155% in the past year.
Chinese brands accounted for 13% of Europe's hybrid-vehicle sales in October 2024, up from 3% a year earlier.
Chinese carmakers are setting up production within the EU to avoid import duties, with plants in Austria, Hungary, and Spain.
European policymakers are considering extending tariffs to hybrids or scaling up domestic hybrid production to counter the influx of Chinese cars.
- Who
- Chinese carmakers (BYD, Geely, SAIC, others) and European policymakers
- What
- Chinese carmakers are circumventing EU tariffs by shifting from EVs to hybrids and setting up production within the EU
- When
- The EU increased tariffs on Chinese EVs in 2024, and Chinese car exports to Europe rose by 26% in the 12 months to November 2024
- Where
- Europe, with Chinese carmakers setting up production in Austria, Hungary, and Spain
- Why
- To avoid high tariffs on EVs and maintain competitive pricing in the European market
- Chinese EV exports to Europe
- 1.2 million in 12 months to November 2024
- Increase in Chinese car exports to Europe
- 26% year-over-year
- Additional tariffs on Chinese EVs
- 17% for BYD, 18.8% for Geely, 35.3% for SAIC, 20.7% for others
- Growth in Chinese hybrid exports to Europe
- 155% in the past year
- Chinese brands' share of Europe's hybrid-vehicle sales
- 13% in October 2024, up from 3% a year earlier
- Chinese brands' share of Europe's EV market
- 12% in October 2024, up from 8% a year earlier
- Chinese car production in the EU
- Xpeng in Graz, Austria; BYD in Szeged, Hungary; Chery in Barcelona, Spain (2026)