When the EU imposed definitive anti-subsidy duties on Chinese-built EVs in late 2024, the question was whether Chinese brands would retreat from Europe. The 2026 answer is unambiguous: they changed shape instead.

What happened

The duties stack on top of the EU's 10% base tariff and vary by cooperation level — roughly 17% extra for BYD, 18.8% for Geely, 35.3% for SAIC, with most other cooperating brands around 21%. Talks between Brussels and Beijing over an alternative minimum-price mechanism have continued intermittently ever since, without a definitive replacement so far.

Why it matters

Tariffs raised the cost of the old model — build in China, ship to Rotterdam — by thousands of euros per car. But they did not touch three alternatives: cars built inside Europe, plug-in hybrids, and premium vehicles whose margins absorb the duty. All three are exactly where Chinese brands moved.

Market context

The localisation wave is the direct result: Leapmotor's B10 from Stellantis's Zaragoza plant, BYD's Hungarian factory ramping, Chery assembling in Spain, Geely weighing European options while routing the Zeekr 7X through Malaysia. [Automotive Logistics] Meanwhile PHEVs — outside the duty's scope — became the import of choice, and MG's petrol and hybrid line-up carried SAIC through the highest tariff band.

Impact on Chinese automakers

The duties effectively sorted the field into three tiers: groups with European production paths (Leapmotor, BYD, Geely, Chery) that treat the tariff as a construction deadline; brands using tariff-exempt product mixes (PHEV-heavy or ICE-heavy line-ups); and pure EV importers, who must either eat margin or hold niche premium positions. What tariffs did not do is close the gap in product cost — Chinese EVs remain price-competitive even after duties.

What to watch next

Any EU-China minimum-price agreement, which would reset the economics overnight; whether PHEVs get pulled into scope; the first duty-review cycle; and how EU rules treat Chinese cars built in third countries such as Thailand and Malaysia. Ongoing coverage: Policy & Tariffs.