EU-China Hybrid Vehicle Deal Threatens Chinese Automakers’ European Expansion

Chinese hybrid vehicle exports to the EU’s 27 member states tripled to $7.5 billion in the first half of 2026, according to Chinese customs data, compared with $2.5 billion in the same period the previous year. This growth rate significantly outpaced the $845 million recorded for the entire year of 2021.

The surge in exports has become critical for Chinese automakers amid domestic car sales declining 20% in the first half of 2026. This trend follows the EU’s October 2024 imposition of additional tariffs on Chinese fully electric vehicles, prompting a strategic shift toward hybrid vehicles to offset weakened domestic demand.