Chinese Automakers Shift to Hybrids to Navigate EU Tariffs

Chinese carmakers are increasing hybrid exports to Europe to sidestep new tariffs on electric vehicles, threatening local automakers' market share.

• The European Union's new tariffs, reaching up to 45.3%, target Chinese electric vehicle imports but exclude hybrids, creating a loophole for Chinese automakers.
• Hybrid vehicle exports from China to Europe tripled between July and October 2024, while electric vehicle shipments to the region declined by 58%.
• Chinese brands like BYD, Geely, and SAIC are introducing competitively priced hybrid models in Europe, challenging established European and Japanese automakers in the plug-in hybrid market.
• BYD's Seal U DM-I hybrid is priced lower than Volkswagen and Toyota's comparable models, and the company is considering expanding production in Hungary.
• Analysts predict China's hybrid exports to Europe will grow by 20% this year, with further increases expected, though concerns remain over potential additional EU trade restrictions.

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