European Union Urges China to Curb Hybrid Vehicle Exports; Seeks to Limit Market Share to 15%

[Financial News] The European Union has begun taking steps to curb Chinese-made hybrid vehicles.
The Financial Times (FT) reported on the 17th (local time) that the European Union had proposed that China voluntarily limit its exports of hybrid vehicles.  Chinese-made hybrid vehicles currently account for more than one-third of sales in the EU market.
The European Union is reportedly seeking to reduce the share of Chinese-made hybrid vehicles to 15%.
There has also been discussion that the European Union could directly restrict imports through higher tariffs or other measures if China refuses to accept voluntary export restrictions.
An EU official said, "If China does not restrict exports to the European market, we will."
The European Union has moved to curb Chinese-made hybrid vehicles because their recent surge in imports has heightened concerns within Europe's auto industry.
Imports of Chinese-made hybrid vehicles into the European Union rose from 3,800 units in October 2024 to 50,000 units in July this year, an increase of more than tenfold.
In October 2024, the European Union imposed tariffs of up to 45% on Chinese-made electric vehicles, citing concerns that subsidies from the Chinese government distort market competition.
By contrast, imports of Chinese-made hybrid vehicles, which are subject only to the standard 10% tariff, have surged.
European automakers, including Volkswagen, are calling for Chinese-made hybrid vehicles to face tariffs as high as those imposed on electric vehicles.
The European Union is reportedly considering an approach similar to the voluntary export restraints agreed upon with Japan in 1986.
At the time, Japan voluntarily limited its vehicle exports to Europe, after which Japanese automakers such as Toyota and Nissan expanded their local investments in Europe.
Meanwhile, the European Union believes China should also exercise restraint in exporting products other than hybrid vehicles, such as chemical products.
European Commission President Ursula von der Leyen said the previous day that the European Union's trade deficit with China had reached €1 billion a day, or approximately 1.6 trillion won, adding, "It has reached a critical point."
President von der Leyen emphasized, "We will use every available means to restore balance to the relationship."
The European Union and China are scheduled to hold talks in Beijing next month on trade imbalances and market access.  


[email protected] Lee Seok-woo, international affairs specialist Reporter