The EU has asked China to voluntarily restrict hybrid car exports to prevent a trade war, ahead of crunch meetings in Beijing next month. Brussels wants Beijing to limit sales of China-made hybrids to around 15 per cent of the EU market, down from more than a third today, citing concerns over deindustrialisation. European carmakers are making mass lay-offs as cheaper Chinese models flood the bloc.

EU Trade Commissioner Maroš Šefčovič is due to speak with Chinese Commerce Minister Wang Wentao on Thursday ahead of a trip to Beijing. The EU aims to repeat the 1986 Japan deal, where export restraints encouraged investment in Europe. Brussels imposed anti-subsidy tariffs of up to 45 per cent on Chinese electric cars in October 2024, but hybrid imports — taxed at 10 per cent — have soared from 3,800 vehicles in October 2024 to 50,000 in July 2026.

German and French officials are forming a consensus for more forceful action. The EU set an October deadline for tangible results to reduce its €1bn a day trade deficit with China.