BRUSSELS: European Union trade commissioner Maros Sefcovic said Friday, Oct. 9, 2026, that China has agreed in principle to moderate its exports of hybrid and plug-in hybrid cars to the EU, opening the prospect of cutting them by more than half.
The understanding, reached after two days of talks in Beijing with Chinese Commerce Minister Wang Wentao, matters because the EU’s trade deficit with China is running at more than 1 billion euros a day, which Sefcovic called “unsustainable.”
“We have reached a shared understanding to moderate China’s export of hybrids and plug-in hybrids to the European Union,” Sefcovic said, according to Euronews. “This opens up the prospect of cutting China’s exports by more than half.” He described the outcome as the end of a “first phase of negotiations.”
No baseline, timetable or mechanism for the reduction has been published. CnEVPost reported that China’s commerce ministry said the understanding complies with World Trade Organization rules but did not disclose specific terms or the scale of any cut in hybrid exports. The ministry said both sides would continue procedures on company price undertakings in the EU’s anti-subsidy case on Chinese electric vehicles.
The talks were the second round of the EU-China Trade and Investment Consultation Mechanism, and the two sides signed a joint statement, Eunews reported. Hybrids were left out of the EU’s October 2024 duties on Chinese battery electric vehicles, which range from 7.8 per cent to 35.3 per cent on top of a 10 per cent standard tariff. CnEVPost, citing a Financial Times report from September, said EU imports of Chinese hybrids rose from 3,800 units in October 2024 to 50,000 in July 2026. Eunews, citing Bloomberg, said Chinese brands made up almost 12 per cent of new car registrations in Europe in August.
The understandings go beyond cars. The sides agreed to improve Chinese market access for EU products, from car parts to olive oil and footwear, which currently account for almost 4 billion euros in exports. Sefcovic estimated duty savings of at least 225 million euros. China also agreed to further facilitate export licences for rare earths and permanent magnets, which Europe’s car, defence and green-technology industries depend on. The Chinese ministry said it would keep that process moving through a “green channel” mechanism.
“Dialogue requires results and, where the dialogue cannot deliver, the EU will use its own instruments,” Sefcovic said, adding that the talks were “a crucial first step, but only a first step in the process of rebalancing.”
The details will face pressure at home. Euronews reported that Germany and France jointly called on the European Commission on Oct. 5 for tougher measures, and that 44 EU industry groups issued a joint statement Oct. 9 urging an effective response to unfair trade practices. EU leaders are due to examine the understandings at a European Council meeting in Brussels on Oct. 15 and 16, where Sefcovic said “the final decision will be taken.” He is to meet Wang again at ministerial level in January 2027, with a third round of consultations planned for March.
Canada has taken a different path. Under a deal announced by Prime Minister Mark Carney in Beijing on Jan. 16, up to 49,000 Chinese-made electric vehicles a year can enter Canada at a 6.1 per cent tariff, down from 100 per cent, the Canadian Press reported. Ontario Premier Doug Ford said at the time that China now has “a foothold in the Canadian market.”
About 15,600 Chinese-made EVs had entered Canada under the quota, less than one-third of the limit, according to figures from International Trade Minister Maninder Sidhu’s office reported in September by the Globe and Mail. Sefcovic and Sidhu met in Toronto on March 5 for a bilateral trade meeting. Whether Brussels’ approach shapes how Ottawa manages the quota has not been addressed by either government in the reporting reviewed here.
The story is developing. Only the EU side has put a figure on the hybrid reduction, and Beijing has not confirmed it.
Via Euronews, Eunews and CnEVPost.
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