After Electric Cars, Are Hybrid Cars Next? Europe Ready to Impose Tariffs on Chinese PHEVs?

The European Union is preparing a new intervention against cars produced in China. Following the introduction of additional tariffs on battery electric vehicles, according to Handelsblatt, Brussels is indeed evaluating the application of new tariffs on Chinese plug-in hybrids (PHEVs).

The additional tariffs on electric cars imported from China came into effect on October 31, 2024, following an investigation into subsidies granted by the Chinese government to domestic manufacturers. According to the European Commission, these incentives distort competition in the community market.

Currently, Chinese manufacturers pay a standard duty of 10%, with differentiated tariffs based on the brand. Vehicles from BYD are subject to an additional rate of 17%, leading to a total imposition of 27%. Geely, on the other hand, has to bear an additional tariff of 18.8%, bringing the total to 28.8%. The most burdensome situation is faced by SAIC, the group owning the MG brand, which faces an additional tariff of 35.3% and a total imposition of 45.3%.

However, several Chinese manufacturers present in Europe have found an alternative path to maintain sales growth. Attention has progressively shifted from pure electric vehicles to plug-in hybrids, which continue to be subject only to the 10% import duty and are excluded from anti-subsidy tariffs.

The figures recorded in Germany clearly show this phenomenon. In May 2026, BYD became the best-selling PHEV brand in the country for the first time, with 4,290 new registrations. Among the most requested models is the compact SUV Atto 2 DM-i, with 2,113 units registered in the same month. Following are the SUV Seal U DM-i and the station wagon Seal 6 DM-i Touring. The company has also recently expanded its range with the debut of the compact Dolphin G DM-i.

The importance of plug-in hybrids within BYD's sales appears particularly significant: about 70% of the brand's new registrations in Germany pertain to PHEV models, while only 30% consists of battery electric vehicles. Although this data refers to a single market, it could represent a broader trend within the European Union.

The European Commission is therefore reportedly working on an anti-subsidy investigation dedicated to Chinese plug-in hybrids. The aim is to introduce new countervailing duties to offset the effects of subsidies deemed distortionary. The new tariffs are expected to maintain a structure similar to that already adopted for electric vehicles, with differentiated rates depending on the manufacturer. However, the amount of the tariffs could be lower on average compared to those applied to battery cars, as the battery pack has a significantly lower impact on the final cost of the vehicle in PHEVs.