China, EU reach hybrid vehicle trade understanding, keep talks alive on EV dispute

China and the European ​Union reached an "understanding" on trade in hybrid vehicles, ​the Chinese commerce ministry said on Friday, after ‌two ​days of talks in which the bloc sought to reduce its trade deficit with Beijing.

European Trade Commissioner Maros Sefcovic has said he was seeking "tangible results" from his visit to China, ‌amid the bloc's growing concerns over the gap, which amounted to over €1 billion ($1.12 billion) a day. The understanding on hybrid vehicle trade in a WTO-compliant manner followed intensive negotiations, the Chinese ministry said, without giving details.

Asked whether the Chinese statement was a joint one, ‌the European Commission said Sefcovic would comment on the talks at a press conference at 1300 GMT. CHINESE CAR IMPORTS TO ‌EU HAVE RISEN SHARPLY

EU officials are concerned by the sharp rise in car imports from China. Imports of plug-in hybrids into the EU have increased 86% in the year to September, with a 20% decline in prices. More than half of these vehicles are now from China, while for ⁠2025, China's ​share of PHEV imports was ⁠30% in value terms. The discussions between Commerce Minister Wang Wentao and Sefcovic in Beijing on Thursday and Friday were "pragmatic and productive," the Chinese ministry said.

China ⁠and the EU also agreed to continue discussions on price undertakings and review procedures related to the EU's anti-subsidy investigation into Chinese electric ​vehicles, according to the ministry. China and EU's dispute over cheap Chinese EV exports, dating to 2024, has clouded bilateral ⁠ties, and has since broadened to include sectors such as brandy, pork and dairy, as well as rare earths and critical minerals.

China needs foreign buyers for ⁠the ​flood of cheap, state-subsidised goods its own shoppers can't absorb, and the EU is torn between welcoming those imports to ease living costs and keeping them out to rebuild its own factories. Both sides will keep exploring the possibility of ⁠lowering tariffs on certain goods within the framework of WTO rules, and continue their dialogue on market access for medical devices, the ⁠Chinese ministry said.

A third ⁠regular meeting of their consultation mechanism will take place in March 2027, and the two sides agreed to maintain communication, including a ministerial-level video conference in January, the ministry said. ($1 = 0.8920 euros)