China-EU trade talks rebalance, stabilize relations

Gaining traction

Much attention has fallen on the understanding reached on hybrid car exports.

In response to a media query, a spokesperson for China's Ministry of Commerce said on Monday that China and the EU had agreed on an arrangement for an "upward adjustment", allowing exports to grow from the 2025 level of EU imports from China, which ensures Chinese automakers have room to maintain exports and achieve stable growth, while taking into account the legitimate concerns of industries on both sides.

According to Eurostat, the EU's statistical office, the grouping's imports of hybrid vehicles from China reached 302,000 units in 2025.

The two sides have agreed an exports quota allocated to China that would not be lower than that granted by the EU to any other source of imports and that EU measures must not specifically target Chinese products or discriminate against Chinese companies, the spokesperson said.

Miao Yingchun, a researcher at Wuhan University's Institute for International Studies, said that the quota agreement made clear China's firm resolve both to safeguard its industries' interests and also to strengthen cooperation with the EU.

Schumann said that by averting a far more damaging spiral of tit-for-tat escalation, the understanding carries weight for German carmakers, whose businesses remain deeply connected to the Chinese market.

German companies are increasingly embracing a local-for-local strategy, with research and development, manufacturing and innovation taking place in China, alongside sales.

Ferdinand Dudenhoeffer, director of the Center for Automotive Research in Bochum, Germany, called the agreement on hybrid cars a "highly significant" outcome of the negotiations, saying it shows China took its trading partners' interests seriously — putting substance behind its commitment to win-win partnership.

"In our cooperation with China, 'win-win' is not just a catchphrase; it is implemented out of genuine conviction," he said. "When China says something, it follows through … when a partner realizes that their concerns are understood, trust is built. Trust is the most important asset in cooperating with a nation as significant as China."

Dudenhoeffer also noted that while frictions have been seen in the EU's trade ties with both China and the United States, the two economies have taken contrasting stances. "The US acts solely out of self-interest and causes harm (through its tariff policies), whereas China shows understanding."