The European Union and China have reached a landmark agreement to drastically reduce the export of Chinese hybrid, electric, and plug-in hybrid cars to the European bloc. EU Trade Commissioner Maroš Šefčovič stated the deal could roughly halve shipments over the next four years, potentially cutting the import of several million vehicles. This move comes amid fears that surging sales of Chinese cars could threaten European jobs and kill off parts of the European car industry.
The agreement is the result of intense negotiations since June and follows two days of talks in Beijing between Šefčovič and China's Commerce Minister Wang Wentao. Both sides described the outcome as a shared understanding aimed at calming escalating tensions over trade imbalances and a trade deficit of €1.18bn a day. Šefčovič characterized the talks as a positive first step and the conclusion of the first phase of negotiations as Brussels pushes for a fundamental rebalancing of trade relations.
Under the terms of the deal, both parties will adhere to procedures concerning company price undertakings for hybrid cars. Beijing has also committed to continuing the supply of vital items, such as rare earth minerals, to the EU. While the European Automobile Manufacturers’ Association called the agreement a positive step in easing trade tensions, it was noted that the deal could lead to an even stronger Chinese auto industry.