Sales of Chinese hybrid cars in the European Union have surged over the past four and a half years, raising alarms in Brussels about the future of the European auto industry. In 2022, just 659 Chinese-made fully hybrid vehicles were sold in the EU. But after anti-subsidy tariffs were imposed on fully electric cars from China in 2024, hybrid sales jumped to 160,662 in the first seven months of this year.
The European Automobile Manufacturers’ Association (ACEA) reported that hybrid cars now make up nearly 37% of the EU market, compared to electric vehicles at just over 21%. Rising sales of Chinese plug-in hybrids, which increased from 56,706 units in 2022 to 217,764 between January and July this year, are causing concern among European carmakers and policymakers. Brussels has even requested that China voluntarily limit its hybrid exports to the EU or face potential quotas.
Chinese companies like BYD, Chery, and Leapmotor have made significant strides in the EU market, with some achieving triple-digit growth. Geely, another Chinese firm, reported an 8% increase in sales during the first eight months of the year, selling 205,000 cars. Geely's brands include Sweden's Volvo and Polestar, the latter being the EU's only all-electric car manufacturer. BYD has also been closing in on Geely, with a 163% rise in sales, reaching 177,000 units sold.
In contrast, Tesla, led by Elon Musk, has been outpaced by these Chinese competitors, selling 142,000 cars across the EU in the first seven months of the year. Despite this, European manufacturers remain strong, with the Volkswagen group selling 2 million cars in the first eight months of 2023.
Electric vehicle sales are rising across various European nations. Germany saw a 75% increase to 69,000 units in August, while France recorded a 112% rise. Slovenia experienced a remarkable 266% jump. The UK reported a 27% increase to 28,000 EVs sold in August, and Ireland's sales rose by 7% to 2,200 units.
Earlier this month, European Commission President Ursula von der Leyen highlighted the growing trade imbalance between the EU and China, reaching €1.18 billion per day, calling it an unsustainable tipping point. In response, EU Trade Commissioner Maroš Šefčovič is set to meet his Chinese counterpart Wang Wentao on October 8 and 9 to find a solution.
At the same time, former US President Donald Trump and Chinese President Xi Jinping are expected to meet again, following their agreement in South Korea last October to lift tariffs on certain Chinese imports in exchange for China suspending its export restrictions on rare earths, crucial for the automotive industry in the US, EU, and UK. A formal agreement might be announced at the upcoming Asia-Pacific Economic Cooperation conference.
