Chinese EV Automakers Set to Strengthen Hold in Europe as Trade Deal Nears

Europe and China are reported to be close to an agreement that would remove EU tariffs on Chinese electric vehicles, and Geely's Polestar and Zeekr are expanding sales and presence across Europe.

Europe and China are reported to be close to an agreement that would remove tariffs on Chinese electric vehicles. The talks follow an EU anti-subsidy tariff imposed in 2024 and involve new guidelines on minimum pricing for imports. Volkswagen has already limited some Hefei-built Cupra models and asked the EU to drop a 20.7% anti-subsidy tariff. At the same time, Geely's Polestar and Zeekr are increasing sales and presence in several European markets. Key developments: - China's commerce ministry said the EU will issue guidelines on minimum pricing for Chinese EVs, Reuters reported. - Under the proposed scheme, Chinese automakers could set minimum sale prices and avoid anti-subsidy tariffs of up to 35% imposed by the EU in 2024, according to the South China Morning Post. - Volkswagen limited the number of models of its Hefei-built Cupra EVs, set a minimum price in Europe, and asked the EU to drop a 20.7% anti-subsidy tariff, the article reports. - Polestar sold 60,119 cars in 2025, with nearly 80% of those sales occurring in Europe, and reported a 27% increase in the fourth quarter of 2025, Reuters reported. - Zeekr is available in 12 EU countries and is reported to be targeting expansion into markets including France, the United Kingdom, Italy and Spain. - Chinese automakers such as Geely Holding Group and Great Wall Motor exhibited at CES while U.S. automakers had fewer major EV announcements, the article notes. Summary: If implemented as reported, the agreement could change competitive dynamics in Europe's EV market by allowing some Chinese models to avoid existing anti-subsidy tariffs while adhering to minimum pricing guidelines. Undetermined at this time.