Chinese automakers are turning to hybrid vehicles to sustain their European market presence following the imposition of higher EU tariffs on electric vehicles. Companies like BYD, Geely, and SAIC are ramping up their exports of hybrids, which combine traditional internal combustion engines with electric batteries and are not subject to the new tariffs. This shift comes as a strategic response to the EU's crackdown on subsidized Chinese EV imports, with tariffs as high as 35.3% imposed on some manufacturers.
Over the past few months, hybrid exports from China to Europe have surged dramatically. Between July and October 2024, more than 65,800 hybrid vehicles were shipped, tripling the numbers from the same period last year. These hybrids are gaining traction due to their affordability, advanced technology, and modern design, making them an attractive alternative to higher-priced European and Japanese models.
Chinese hybrids are particularly appealing to European consumers amidst the ongoing cost-of-living crisis and rising interest rates. The vehicles offer a blend of traditional and electric power, serving as a transitional option for those not ready to commit fully to electric vehicles. Hybrids are often less expensive than EVs and provide tax incentives in many European countries, further bolstering their popularity.
This strategy allows Chinese manufacturers to maintain a competitive edge in Europe while navigating the barriers posed by the EU’s tariffs. However, the success of Chinese hybrids could prompt the EU to consider additional trade measures to protect domestic automakers, potentially targeting hybrid vehicles with new tariffs.
For now, the hybrid strategy has positioned Chinese manufacturers as formidable competitors in the European automotive market, challenging established brands like Toyota, Honda, and Volkswagen.
