EU Secures Deal to Halve Chinese Hybrid Car Imports

China has agreed to cut its hybrid car exports to the European Union by more than half over four years, in what Brussels calls a landmark deal to protect the European car industry.

The EU said the agreement is the first of its kind. It follows fears that surging Chinese hybrid sales could kill off parts of the European car industry and put European jobs at risk.

Trade commissioner Maroš Šefčovič said the deal resulted from "intense" negotiations with China that began in June. The talks aimed to curb a trade deficit of €1.18bn (£1bn) a day, a figure that has caused mounting tensions between the two economic powers.

What does the deal change?

Under the agreement, Beijing's shipments of hybrid cars to the bloc could fall by more than half over four years, cutting millions of vehicles from European roads' supply pipeline. Brussels framed the reduction as a direct response to the pace of Chinese sales growth in the EU market.

Šefčovič described the arrangement as the first deal of its kind between the two trading powers. He said the negotiations had been "intense" since they started in June.

Why did the EU push for it?

The driving force behind the agreement is a trade deficit that runs at €1.18bn (£1bn) per day. That imbalance has generated mounting tensions between Brussels and Beijing.

European officials also voiced fears that surging hybrid sales from China could kill off parts of the European car industry, with consequences for European jobs.

The deal now sets a template for how the EU and China manage one of the world's largest bilateral trade relationships — and a test case for whether negotiated caps can resolve disputes that tariffs have failed to settle.