China and EU Reach Electric Vehicle Trade Understanding Amid Tensions

China and the European Union have concluded their second trade consultation with a consensus on hybrid and electric car trade. The agreement was reached following two years of trade friction and EU extra duties on Chinese-built electric cars.

Within hours of the Beijing meeting, China's industry association and eight major carmakers—Leapmotor, Chery, Changan, Dongfeng, BYD, Geely Holding, GAC, and Great Wall—issued coordinated endorsement statements. According to reports from Ijiwei and Caixin, the two sides negotiated on the principle of mutual respect and equal consultation in a way consistent with World Trade Organization rules. The trade protection and direct-export barriers are squeezing Chinese carmakers so hard that excess capacity may need to be cleared, pushing exporters toward building factories inside Europe, though that escape route remains far from smooth.

The coordinated industry endorsements serve as a signal of alignment with the negotiation outcome, acting as a truce line under the hybrid and EV file. The next consultation session will be monitored to see if the understanding survives contact with tariffs not yet named.