EU and China Agree on Hybrid Car Quotas and Tariff Cuts

The EU and China have reached a major trade agreement. It sets quotas on Chinese hybrid car exports to Europe. It also lowers Chinese tariffs on European goods.

European Commission President Ursula von der Leyen detailed the agreement on October 21, 2026. The deal sets an annual quota of 350,000 Chinese hybrid vehicles. This limit represents a 45 percent reduction in these exports. The EU will enforce this reduction through a safeguard mechanism starting December 1.

China agreed to reduce tariffs on nearly 4 billion euros in EU exports. China will also provide fast-track export licensing for rare earth materials to European manufacturers. This update was reported by Tax at Hand.