EU apparently considering import restrictions for Chinese hybrids
After China rejected voluntary export restrictions on hybrid cars to the EU, the European Commission is now preparing import restrictions for such vehicles via a safeguard procedure. However, this could also just be a pressure tactic to negotiate a deal, as both parties have entered talks in Beijing regarding the matter.
Chinese hybrid bestseller BYD Seal U DM-i
Image: BYD
After the EU imposed special tariffs on electric cars from China of up to 35.3 per cent (depending on the manufacturer) two years ago, a similar measure for hybrid vehicles now also looks increasingly likely. Since summer 2025, it has become evident that, as a result of the punitive tariffs, particularly active Chinese brands in Europe, such as BYD and MG Motor, are increasingly focusing on hybrids. These are subject only to the regular car tariff of 10 per cent. While BYD is exclusively focusing on plug-in hybrids (PHEVs), such as the bestselling BYD Seal U DM-i – which alone has achieved 11,291 new registrations in Germany since the beginning of the year (January to September) – MG Motor also has successful full hybrids in its portfolio.
In other words: although the special tariff curbs the import of locally emission-free BEVs, it does not apply to hybrid vehicles – which combine combustion and electric motors and thus also emit CO 2 locally. This is also detrimental to the EU’s climate goals.
For this reason: according to media reports, the European Union called on China several weeks ago to voluntarily restrict its exports of hybrid vehicles to Europe – but China refused. In its initial response to the EU’s request to limit hybrid exports to the EU, China’s Ministry of Commerce stated that “so-called voluntary export restrictions seriously violate WTO rules and run counter to market principles and fair competition”. _CNEV Post_ added that the ministry rejects “their use to resolve automotive trade disputes between China and the European Union”.
Quotas instead of special tariffs for the first hybrid vehicles
However, the EU appears undeterred: according to _Bloomberg_, the European Commission is now preparing measures to limit the import of Chinese hybrid vehicles into the European Union. _Bloomberg_ cites sources familiar with the matter.
Unlike with electric cars from China, there will apparently be no special tariff for each imported hybrid vehicle from China. Instead, the European Commission is reportedly considering setting quotas, as Canada has done with electric cars from China. This means: within a defined period, a certain number of hybrid vehicles from China could continue to be imported into the EU at the regular car tariff rate of 10 per cent. However, if manufacturers wish to import additional Chinese hybrids, an additional special tariff of as yet unknown magnitude would then apply.
Safeguard instrument can be implemented more quickly
In this case, Brussels would most likely rely on the EU’s safeguard instrument. This allows for special tariff quotas, among other measures, in the event of a sudden surge in imports and the resulting – or threatened – serious harm to European manufacturers. Within a set import volume, existing tariffs apply, while an additional levy can be imposed beyond that. However, such safeguards are not typically country-specific but are usually applied by the EU to imports of such products from all third countries.
Thus, the import restrictions for hybrid vehicles would represent a completely different measure compared to the special tariffs on electric cars from China. In the case of BEVs, the EU concluded after a lengthy anti-subsidy investigation that some automakers in China receive excessively high subsidies from the Chinese government, enabling them to offer their products in Europe at lower prices than European companies, which do not receive equivalent support. Therefore, the so-called special tariffs are effectively anti-subsidy duties, which vary depending on the manufacturer and the extent of the respective subsidies.
A safeguard measure – such as the one now apparently planned for hybrid vehicles – can, however, be implemented much more quickly. The European Commission seemingly considers the prerequisites for this to be met, as imports of hybrids from China have exploded from 3,800 vehicles in October 2024 (the time when anti-subsidy tariffs for electric cars came into force) to around 50,000 units by July 2026.
Šefčovič in negotiations in Beijing
EU Trade Commissioner Maroš Šefčovič is expected in Beijing today (Thursday) and tomorrow (Friday) for talks with Chinese Commerce Minister Wang Wentao. The outcome could influence the plans. We will update this article as soon as there is news from Beijing.
According to information from the _Handelsblatt_, Šefčovič and his team will first attempt again during the talks in Beijing to persuade China to limit its exports of hybrid and electric vehicles to the EU. “The deal would at least temporarily curb the rise in Chinese car exports,” said SPD politician Bernd Lange, Chairman of the European Parliament’s Trade Committee, to the newspaper. “The goal is to flatten the import curve and give the European automotive industry time to do its homework.”
Japan deal as a model?
According to the _Handelsblatt_, a possible model for such a deal could be an agreement that Europe reached with Japan around 40 years ago. At the time, Japan limited the exports of its emerging automotive industry to Europe, but in return, Toyota, Nissan and Honda built plants in Europe. This created jobs not only in the factories themselves but also among suppliers. A similar path is already emerging for Chinese manufacturers: BYD will still start series production this year at its new plant in Szeged, Hungary; Chery is producing alongside Ebro in Barcelona; and Xpeng is already assembling electric cars using the SKD process at Magna Steyr in Graz.