A group of Chinese automakers — including Nio, XPeng, and Xiaomi— took part in discussions between China and the European Union on Tuesday and Wednesday, as they seek to avoid higher tariffs while expanding their presence in the European market.
The Auto Working Group was established in February by the China Chamber of Commerce to the EU (CCCEU) and represents over a thousand of Chinese enterprises operating across Europe.
Led by Hui Zhang, VP of Nio Europe, the group met with EU Commissioner for Trade and Economic Security as well as Interinstitutional Relations and Transparency Maroš Šefčovič and MEP Bernd Lange, responsible for the EU’s Committee on International Trade.
According to the CCCEU, “Nio, XPeng, Xiaomi, Eve Energy, Gotion & Catarc discussed US-EU trade, EV tariffs, green policies and investment climate,” with “all sides committed to dialogue.”
Earlier this month, China’s CCTV reported that the technical part of negotiations between the two blocs was “basically complete.”
According to a post on Weibo, it was up to the EU to “demonstrate the political will needed to promote a resolution.”
By then, a spokesperson for the Chinese Foreign Ministry urged the EU in a media briefing to adopt a fair and balanced approach in China-EU trade, calling for mutual trust, open dialogue, and avoiding the securitization of economic issues.
Last year, the EU imposed tariffs on Chinese electric vehicle imports after determining the industry received significant government subsidies, which led to unfair trade in the region.
By then, China proposed setting a minimum price of €30,000 for Chinese-made electric vehicles sold in Europe.
However, the EU kept its position firm, arguing that the problem went beyond pricing and insisting on the state subsidies that distort fair competition in the European market.
Talks were reestablished in April, as Trump’s new tariffs took place.
EU Trade Commissioner Šefčovič and China’s Commerce Minister Wang agreed to investigate the possibility of setting minimum prices for the imported EVs as an alternative to tariffs.
China has also agreed to fast-track approvals for qualified rare earth exports to Europe — which had been restricted in May, in retaliation against new U.S. tariffs.
BYD faces since late last year a 17.4% duty, Geely 20%, and SAIC 38.1%. These are on top of the existing 10% import duty, bringing the total levies to as much as 48.1% for SAIC.
Geely owns Volvo Cars and Polestar, while SAIC operates MG, a budget brand popular across Europe.
Aiming to mitigate the impact of the EU tariffs on China-made electric vehicles, Chinese automakers are setting up local production.
BYD has set its European headquarters in Hungary, where it is also in the final stages of building an EV plant.
The factory is expected to begin operations in late 2025, with an annual production capacity of around 200,000 vehicles.
Chinese automakers are further expanding to the United Kingdom, which is the second largest EV market in Europe (with one in each four vehicles sold being fully electric).
Unlike the European Union, which it left back in 2020, the Great Britain has not imposed tariffs on Chinese-made EVs.
Chery, which is set to launch two new SUVs in the UK, is “actively considering” building its second plant in the island, according to Victor Zhang, Chery Auto‘s UK Director.
XPeng, which just launched in the UK and continues to expand across Europe, with sales reaching new records in June, extended its collaboration with German legacy automaker Volkswagen.
The duo has partnered back in 2023 for the joint-development of two mid-sized fully electric models. In early 2025, the collaboration was strengthened to build a super-fast charging network in the country.
State-owned automaker GAC has signed on Wednesday a dealership agreement with Jameel Motors to distribute its Aion brand in the UK.
