China and the European Union reported progress on hybrid vehicle trade after two days of talks in Beijing on October 8 and 9. EU Trade and Economic Security Commissioner Maros Sefcovic said the shared understanding includes halving Chinese exports of hybrid electric vehicles (HEVs) and plug-in hybrids (PHEVs) to the EU. China’s Commerce Ministry said the understanding followed intensive consultations and complied with World Trade Organization rules, but did not give details of the proposed reduction.
Important questions remain unresolved publicly: neither side specified the export baseline, timetable or mechanism for a cut. Sefcovic also pointed to improved access for EU companies in China and further easing of Chinese rare-earth export licensing. China said it would continue facilitating EU-bound rare-earth and permanent-magnet license approvals through a “green channel.”
Hybrid imports have become a point of tension after the EU imposed additional countervailing duties on China-made battery-electric vehicles in October 2024, while excluding hybrids. Those extra duties ranged from 7.8% to 35.3%, on top of the bloc’s standard 10% import tariff. A Financial Times report cited in the article said EU imports of Chinese hybrids climbed from 3,800 vehicles in October 2024 to 50,000 in July 2026.
The two sides will continue work on company price undertakings and reviews in the EU’s anti-subsidy case concerning Chinese EVs, and will explore possible tariff reductions on some goods under WTO rules. A ministerial video conference is planned for January 2027, followed by another meeting of the trade and investment consultation mechanism in March.