Business · Trade · 3 days ago
EU and China reach understanding to cut hybrid car exports by more than half
The European Union and China have reached an understanding to moderate Chinese exports of hybrid and plug-in hybrid cars to the EU.
EU trade commissioner Maros Sefcovic said the change could reduce exports by more than half compared with what China would otherwise ship over four years.
The two sides have not said how the limit will work or given a starting figure, and China’s statement did not quantify the impact.
The issue is part of a wider trade dispute: the EU says its large goods-trade deficit with China threatens European industry and jobs.
The EU’s extra tariffs on Chinese battery electric cars, imposed in 2024, did not cover hybrids, whose imports have since grown.
The discussions also covered easier export licences for rare earths and permanent magnets, and possible lower Chinese tariffs on some European products.
The sides plan another round of negotiations in March 2027.
The European Union and China reached an understanding to moderate Chinese exports of hybrid and plug-in hybrid vehicles to the EU, with the possibility of reducing them by more than half.
European Trade Commissioner Maros Sefcovic said the potential reduction was measured against exports expected without new measures and could amount to several million fewer cars over four years.
The agreement followed two days of talks in Beijing between Sefcovic and Chinese officials, including Commerce Minister Wang Wentao.
Sefcovic also cited progress on lower Chinese tariffs for European products worth about €4 billion in sales and on access to export licences for rare earths and permanent magnets.
The articles differ slightly in how they describe the vehicle-export target: Expansión says the aim is a reduction of around 50%, while El País reports that the understanding opens the possibility of a reduction of more than half.
- Who
- The European Union and China; the talks involved EU Trade Commissioner Maros Sefcovic and Chinese Commerce Minister Wang Wentao.
- What
- An understanding to moderate Chinese exports of hybrid and plug-in hybrid vehicles to the EU, alongside progress on tariffs and rare-earth export licences.
- When
- 9 October 2026, after two days of talks.
- Where
- Beijing, China.
- Why
- To rebalance trade relations, ease pressure on European industry and improve European companies’ market access and supply of essential materials.
This story does not have two clearly opposing sides.
The EU imposed additional tariffs of up to 35.3% on battery-electric vehicles made in China, while hybrids were excluded.
The EU and China began talks through a consultation mechanism on trade and investment.
After two days of meetings in Beijing, the sides announced an understanding on moderating Chinese hybrid and plug-in hybrid exports to the EU.
A joint statement scheduled a third round of negotiations.
- Potential vehicle-export reduction
- More than half, compared with exports expected without new measures; Sefcovic said this could mean several million fewer cars over four years.
- European sales affected by potential tariff reductions
- About €4 billion.
- Estimated potential savings for European companies
- About €225 million.
- Maximum additional EU tariff on Chinese battery-electric vehicles
- 35.3%, imposed in October 2024.
- Next negotiation round
- March 2027.
What people are saying
Estamos lejos del final. Es un primer paso crucial, pero solo un primer paso en el proceso de reequilibrio
Hemos alcanzado un entendimiento común para moderar las exportaciones chinas de híbridos e híbridos enchufables a la UE. Esto abre la posibilidad de reducirlas en más de la mitad
es la primera vez que China ha aceptado moderar sus exportaciones sin pasar antes por una fase de tensión comercial
Sources
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