China Says EU Hybrid Trade Deal Allows Export Growth Above 2025 Levels

• The commerce ministry said the arrangement allows growth from the 302,000 hybrid vehicles the EU imported from China in 2025.
• China said its quota would be no lower than that of any other source of EU imports, without disclosing specific volumes or an implementation timeline.

China's commerce ministry said its hybrid vehicle trade agreement with the European Union allows growth from 2025 import levels, ensuring room for Chinese companies to expand exports steadily.

In a statement responding to questions on Monday, the ministry elaborated on the principles underpinning the arrangement, after an EU statement that Chinese hybrid vehicle exports to the bloc would be halved drew attention.

The EU's hybrid vehicle imports from China rose to 302,000 in 2025 from 107,000 in 2024, the ministry said, citing Eurostat data.

The arrangement allows growth from the 2025 baseline and addresses the reasonable concerns of both sides' industries in light of market conditions, the ministry said. It did not disclose specific quotas, an implementation timeline or the extent of the increase.

The statement provides a new baseline for understanding the agreement, though information released by both sides remains insufficient to establish the scale of the final arrangement or how it will be implemented.

EU Commissioner for Trade and Economic Security Maros Sefcovic said on October 9 that the agreement included halving China's exports of hybrid electric vehicles (HEVs) and plug-in hybrid electric vehicles (PHEVs) to the bloc.

He did not specify the baseline for that reduction. China's latest statement also did not explain how his remarks relate to an arrangement allowing growth from 2025 levels.

The ministry said the 2 sides had confirmed 3 basic principles: respect for facts, non-discrimination and compliance with rules. Any measures would neither specifically target Chinese products nor discriminate against Chinese companies.

China's quota would be no lower than that of any other source of EU imports, the ministry said, adding that both sides had affirmed the trade arrangement should comply with World Trade Organization (WTO) rules.

China also reserves all rights under the WTO framework, including recourse to dispute settlement and requests for trade compensation, the ministry said. The principles are intended to safeguard the legitimate rights and interests of Chinese companies.

The clarification followed talks between Chinese Commerce Minister Wang Wentao and Sefcovic in Beijing on October 8 and 9, after which both sides announced an understanding on hybrid vehicle trade.

Hybrids have become a new focus of China-EU automotive trade talks. The EU imposed definitive countervailing duties on China-made battery electric vehicles (BEVs) in October 2024, while hybrids were excluded from those measures.

Bloomberg reported on October 7, citing people familiar with the matter, that the EU was preparing safeguard measures for hybrid vehicles that could restrict imports through tariff-rate quotas.

On BEVs, the ministry said the 2 sides achieved a "soft landing" in the anti-subsidy case in January this year, when the EU issued general guidance on price undertakings.

The EU will continue procedures related to company-specific price undertakings and other reviews in the electric vehicle case, the ministry said. It added that the agreements protected Chinese companies' practical interests and prevented an escalation in trade tensions.