By Anthony Henson, December 16, 2024
Europe is currently facing significant challenges, most of which are self-inflicted. However, we won’t delve into the reasons here—this isn’t a political blog; it’s the Daily Car Blog. A trade war is brewing between the EU and China, or rather, a trade war initiated by the EU to counter cheaper and technologically superior Chinese EV imports. China is leading the EV race with greater investment, advanced technology, and vehicles that offer near-BMW levels of premium luxury at half—or less than half—the price.
To prevent EU citizens from accessing more affordable non-EU-made EVs, EU legislators are set to impose heavy tariffs on Chinese imports. This doesn’t strike me as democratic, but it will inevitably provoke a tit-for-tat response from China. In the end, consumers will bear the brunt, though China will likely suffer far less than EU policymakers anticipate, as its EV industry continues its unstoppable momentum.
The harsh truth is that Europe remains trapped in an outdated colonial mindset, relying on the “acquisition” of natural resources—by any means necessary—to sustain its civilization. Meanwhile, Europe is forgetting how to compete in manufacturing and innovation, as it watches China surge ahead. Unable to keep up, the EU resorts to punitive sanctions and tariffs in a futile attempt to delay the inevitable.
But the Chinese have a cunning plan and will circumvent EU tariffs on electric cars by increasing their hybrid vehicle exports. Hybrid cars, which combine electric and internal combustion engines, are exempt from these tariffs. Additionally, some Chinese companies are establishing assembly and production facilities within the EU to further reduce costs and tariff impacts.
This strategic approach is expected to intensify competition for both Japanese and European car manufacturers, potentially impacting sales for companies like Toyota, Honda, Nissan, and Volkswagen. China’s hybrid car exports to Europe have surged, tripling from July to October 2023 compared to the same period last year. Major Chinese automakers like BYD, Geely, and SAIC are driving this growth with a diverse lineup of hybrid models.
BYD is introducing its first European hybrid models, the SEAL U DM-i and Song Plus DM-i, while Geely offers plug-in hybrids like the Galaxy Starship 7 and mild hybrids like the Azkarra. SAIC is also contributing with models such as the MG6 PHEV, Roewe Erx5 Super Hybrid Edition, MG3 HEV, and MG EHS Plug-in Hybrid.
This surge in Chinese hybrid vehicles is set to heighten competition in the European market, potentially challenging established European and Japanese brands.
