China Agrees to Curb Hybrid Car Exports to the EU
China has agreed to moderate its exports of hybrid and plug-in hybrid cars to the EU, which EU trade commissioner Maroš Šefčovič announced could cut them by more than half. This comes after the second round of EU-China trade and investment consultations in Beijing.
“It is unsustainable and it demands a credible path to rebalancing,” Šefčovič stated regarding the EU’s trade deficit with China.
As part of the agreement, China will also:
- Cut tariffs on certain EU goods, including car parts, olive oil, and footwear, worth almost €4 billion.
- Ease export licensing for rare earths and permanent magnets.
No specific volumes or timelines were provided for the reduction in car exports. The Commission has yet to publish a written agreement.
“By this step we are actually preventing several millions of car exports from China to the European Union,” Šefčovič said, as reported by the Associated Press.
The consultations began in June, and the final decision on the agreement lies with EU leaders. Further discussions are planned for January and March.
Šefčovič has previously advocated for a new tool to reduce Europe's dependence on Chinese supply chains.
China has expressed concerns about the EU's recent restrictive measures, while the EU has blocked imports of advanced chipmaking machines from China on national security grounds.
The EU's trade surplus with China reached €360 billion last year, and hybrids are currently outselling every other powertrain in Europe.