When gasoline in Germany surged past €2.30 per litre this month, the ripple effect was felt across the entire continent. Drivers, suddenly confronted with a steep cost of combustion, began to explore alternatives that could soften their wallets. The shift was unmistakable: battery-electric registrations rose 62.7% year on year in August representing 21.7% of all new registrations during the first eight months of the year.
Record fuel prices accelerate the electric and hybrid transition
The surge in gasoline prices coincided with a dramatic climb in plug-in hybrid sales, a segment that blends electric range for city driving with a conventional engine for longer trips. Eurostat data show that only 659 fully-hybrid cars built in China were sold in the EU in. By the first seven months of this year, that figure exploded to 160,662 units. Likewise, plug-in hybrids that can recharge from an external source leapt from 56,706 in to 217,764 between January and July.
Chinese manufacturers dominate the hybrid boom
Three Chinese firms—BYD, Chery and Leapmotor—registered triple-digit growth in the European market, while Geely added an 8% increase during the first eight months, reaching 205,000 units sold. BYD’s sales surged by 163% year on year, delivering 177,000 cars, and together with Geely and SAIC they now outpace Tesla’s 142,000 deliveries in the bloc. Even as Volkswagen retained its heavyweight status with two million cars sold in the same period, Chinese brands have claimed roughly one-third of all hybrid transactions and are projected to approach 100,000 units by the close of 2026.
Brussels’ trade response and industry backlash
In the European Commission imposed additional anti-subsidy duties of up to 35% on Chinese-made electric vehicles, stacking on a baseline 10% tariff. The measure was presented as a defence against perceived unfair competition, yet plug-in hybrids remained exempt, creating a loophole that Chinese producers quickly exploited. Brussels has now asked Beijing to voluntarily curb hybrid exports to a 15% market share—a request that would halve the current Chinese presence—but Beijing has not confirmed receipt of the appeal.
The German Association of the Automotive Industry (VDA) signalled for the first time its willingness to consider specific tariffs on Chinese hybrids. In a statement, VDA urged the European Commission to deploy a comprehensive set of WTO-compliant trade-defence tools, ranging from quotas to price floors, to ensure a level playing field.
Meanwhile, the Chinese Ministry of Commerce warned that any imposed limits would breach World Trade Organization rules and the principles of fair competition. The ministry added that Beijing will monitor European actions closely and will take necessary steps to protect its automotive exporters.
Negotiations are slated for early October, when EU trade commissioner Maroš Šefčovič is set to meet his Chinese counterpart Wang Wentao. The talks aim to defuse mounting tensions and possibly draft a mutually acceptable safeguard framework.
