The EU will cap imports of Chinese-made hybrid cars at 350,000 a year from December, which could halve them. Sensible protection for Europe's car industry, or bad news for buyers?
The four-year quota, agreed with Beijing under World Trade Organization safeguard rules, covers plug-in hybrids too. Cars over the limit won't be taxed but will be held at customs. Chinese brands' cars built inside the EU, such as in Hungary, are exempt, while EU firms' China-made cars are not.
What happened
The European Commission has confirmed a quota limiting hybrid vehicles imported from China, including plug-in hybrids, to 350,000 a year. It is due to start in December and last four years. EU trade chief Maroš Šefčovič said the deal, agreed with Beijing, could halve Chinese hybrid exports to the bloc, which tripled in value to €6.7bn in the first half of this year. Cars over the quota will be held at customs rather than taxed, and Chinese-brand cars built in the EU are exempt. In return, China agreed to cut some tariffs on car parts and halve duties on EU footwear, olive oil and ice-cream.
Why people disagree
Supporters say surging cheap imports threaten factory jobs in Europe's industrial heartlands, point to an EU trade deficit with China of about £1bn a day, and note that China itself agreed to the quota. Critics say capping imports limits buyers' choice of affordable hybrids, and that shielding EU carmakers from firms that can build an electric car for about $20,000 against $31,000 in Europe, by one industry estimate, may slow them adapting.
What's still unclear
Whether the cap raises prices or simply moves Chinese production into Europe, as BYD is already building a plant in Hungary. Officials say talks on chemicals, renewable energy and furniture continue and this is "by no means the end of the story".
Sources
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