# EU Weighs Tariff Quotas on Chinese Hybrids as Chinese Carmakers Expand European Manufacturing The European Union is considering temporary trade safeguard measures on Chinese hybrid vehicles, potentially imposing additional tariffs on volumes exceeding import quotas as soon as December, while Chinese automakers and battery suppliers deepen manufacturing partnerships across Europe\. By China EV Signal Published: 2026-10-12T12:47:34.486Z Updated: 2026-10-12T12:47:34.490Z Canonical article: https://chinaevsignal.com/news/eu-tariff-quotas-chinese-hybrids-european-manufacturing ## Key takeaways - EU Trade Commissioner Šefčovič said the two sides reached a preliminary understanding on hybrid vehicle trade, under which China's hybrid exports to Europe could fall by more than half over the next four years compared with previous forecasts\. - The European Union is considering temporary trade safeguard measures with import quotas and additional tariffs on vehicles exceeding those quotas, with implementation possible as soon as December; specific quota levels, tariff rates and implementation methods have not been determined\. - Chinese brands' share of Europe's plug-in hybrid market rose from 2% in 2024 to 25% in the first half of 2026, while their share of the ordinary hybrid market rose from 2% to 14% over the same period, according to ACEA\. ## EU Considers Safeguards on Chinese Hybrids The European Union is considering temporary trade safeguard measures on Chinese hybrid vehicles, managing imports through quotas and imposing additional tariffs on vehicles exceeding those quotas, with implementation possible as soon as December, according to overseas media reports on October 10\. Specific quota levels, tariff rates and implementation methods have not been determined\. EU Trade Commissioner Šefčovič said the two sides have reached a preliminary understanding on hybrid vehicle trade, under which China's hybrid exports to Europe over the next four years could fall by more than half compared with previous forecast scenarios\. ## Existing Tariffs on Chinese-Built EVs On October 30, 2024, the European Union formally imposed five-year countervailing duties on Chinese-made pure electric vehicles, adding tariffs of 7\.8% to 35\.3% on top of the existing 10% import duty\. BYD applies a 17% additional rate, Geely 18\.8% and SAIC Group 35\.3%\. According to a study published by an overseas institution in July of this year, Chinese-made pure electric vehicles held a 22% share of the EU pure EV market at their 2024 peak, falling to 17% in the first quarter of 2026\. ## Chinese Brands' Rising Hybrid Market Share Chinese brands' share of Europe's plug-in hybrid market rose from 2% in 2024 to 25% in the first half of 2026, a 23 percentage point increase over two years, according to the European Automobile Manufacturers' Association \(ACEA\)\. Their share of the ordinary hybrid market rose from 2% to 14% over the same period\. ACEA Director General Sigrid de Vries warned that the rapid growth of Chinese hybrid imports and possible intense price competition would deal a severe blow to Europe's auto industry\. The German Association of the Automotive Industry \(VDA\) also supports improving trade conditions through negotiations, but stressed that China is an important sales market, procurement market and innovation center for Germany's auto industry, and that excessive protection could trigger trade conflicts and harm Europe's own automotive interests\. ## Chinese Carmakers Expand European Production In Barcelona, Spain, Chery is working with local company EBRO to restart vehicle manufacturing at a former Nissan plant\. The factory currently assembles multiple models including ordinary hybrids and plug-in hybrids, with targets of 30,000 units annually in 2026 and 50,000 units in the medium term\. In May, Stellantis and Leapmotor announced plans to expand their European manufacturing cooperation, with production of the Leapmotor B10 planned at Stellantis's Zaragoza plant in Spain, and a study of an additional Opel pure electric SUV using components from Leapmotor's international cooperation system\. Stellantis and Leapmotor also plan to expand joint procurement and are studying the use of the Madrid plant for more Leapmotor models\. ## Battery Partnerships Deepen On September 28, Volkswagen Group announced it would further deepen cooperation with Gotion High-tech, planning to establish three joint ventures in Spain, Slovakia and Morocco\. Under the arrangement, Gotion plans to invest about 1\.1 billion euros for a 49% stake in Volkswagen's PowerCo battery plant in Spain\. After the transaction, PowerCo would retain 51% and keep controlling status\. PowerCo plans to invest a total of about 470 million euros before 2030 to acquire 49% stakes in Gotion's Slovakia cell project and Morocco cathode material project\. The transactions still require regulatory and shareholder approval\. The PowerCo plant in Sagunto, Spain, has a planned capacity of 30 GWh and is expected to begin operations in 2027\. Volkswagen expects LFP's share of Europe's battery market to rise from about 10% currently to 40%–60% by 2030\. ## CATL's European Battery Projects On September 22, the first two cell production lines at CATL's Debrecen plant in Hungary started trial operation\. The project was announced in 2022 with an overall planned capacity of 100 GWh\. In Spain, CATL's LFP battery joint venture with Stellantis has also entered the construction phase\. The project officially broke ground in November 2025 and has a planned capacity of up to 50 GWh\. ## EU Industrial Policy The European Commission has proposed an Industrial Acceleration Act, which aims to keep more industrial investment and manufacturing activity in Europe through public procurement, industrial support and local manufacturing requirements\. The legislation is still in the legislative process\. ## Company coverage - [BYD news](https://chinaevsignal.com/manufacturers/byd) - [Geely news](https://chinaevsignal.com/manufacturers/geely) - [CATL news](https://chinaevsignal.com/manufacturers/catl) - [Chery news](https://chinaevsignal.com/manufacturers/chery) - [Leapmotor news](https://chinaevsignal.com/manufacturers/leapmotor) ## Original publisher 高工锂电. Published: 2026-10-11T11:17:56.000Z