Sales of Chinese hybrid cars in the European Union have surged dramatically over the past four and a half years, raising alarms in Brussels about the future of the region's automotive industry. The increase follows the EU's imposition of anti-subsidy tariffs on fully electric vehicles from China in 2024, which did not extend to hybrids.
In 2022, only 659 Chinese-made fully hybrid cars were sold in the EU. However, this number skyrocketed to 160,662 in just the first seven months of this year. The European Automobile Manufacturers’ Association (ACEA) reports that hybrid vehicles now make up nearly 37% of the EU market, while electric cars account for just over 21%.
Chinese plug-in hybrid sales have also seen a significant rise, jumping from 56,706 units in 2022 to 217,764 between January and July this year. This growth has prompted the EU to request that China voluntarily limit its hybrid exports to the region or face potential safeguards, likely in the form of quotas.
Among the Chinese manufacturers making substantial gains in the EU are BYD, Chery, and Leapmotor, all experiencing triple-digit growth. Geely, which includes brands such as Volvo and Polestar, remains the most popular Chinese brand in the EU, with 205,000 cars sold in the first eight months of the year, marking an 8% increase. BYD is rapidly closing the gap with Geely, achieving a 163% increase in sales year-on-year, totaling 177,000 units.
Despite the influx of Chinese vehicles, European carmakers continue to lead the market. The Volkswagen Group alone sold 2 million cars in the first eight months of the year. Electric vehicle sales are also climbing in Europe, with Germany seeing a 75% increase to 69,000 units in August, and France experiencing a 112% rise. Slovenia reported a 266% surge in sales. In contrast, the UK saw a 27% increase, while Ireland's growth was a modest 7%.
Earlier this month, European Commission President Ursula von der Leyen highlighted the growing trade deficit between the EU and China, now at €1.18 billion per day, as reaching an unsustainable tipping point. In response, the EU's trade commissioner, Maroš Šefčovič, is scheduled to meet with his Chinese counterpart, Wang Wentao, on October 8 and 9 to seek a resolution.
Meanwhile, international trade dynamics remain tense, with former U. S. President Donald Trump and Chinese President Xi Jinping having met in their third summit in a year. Last October, Trump agreed to lift tariffs on certain Chinese imports in exchange for China suspending its export restrictions on rare earths, which are crucial for the automotive industry in the U. S., EU, and UK. However, some speculate that a formal agreement might not be reached until the upcoming Asia-Pacific Economic Cooperation conference.
