China agrees to curb hybrid car exports to Europe
China agreed Friday to limit its exports of hybrid cars to the European Union, a first-of-its-kind deal. Brussels says shipments could fall by more than half over four years. Europe fears cheap Chinese cars could cost thousands of factory jobs, but how the limits will work is still unclear.
The European Union says it has a deal with China to slow the flood of Chinese hybrid cars into Europe.
EU trade commissioner Maroš Šefčovič announced the agreement in Beijing on Friday. He said it "opens the prospect of cutting China's export [of hybrids] by more than a half" over four years, which would mean "several millions" fewer cars, The Guardian reported.
Hybrids use both a gas engine and a battery. Chinese carmakers have been selling them in Europe in growing numbers, and European officials worry this could kill jobs at their own car factories.
Šefčovič called it the first time China had agreed to slow its exports before a formal trade fight. Normally, the EU would first run an investigation under World Trade Organization rules. "This is far from the end. It's a crucial first step, but only a first step," he said.
The deal is part of a 16-point agreement. The two sides will keep talking about cars, rare-earth minerals and selling more European food and drink in China. China's commerce ministry said it would keep helping approve export licenses for rare earths and magnets bound for Europe.
Key details are still missing. Politico reported that the cut is measured against projected growth, not today's sales. Automotive World said the deal promises a halving but not the method. China said both sides would follow procedures on company "price undertakings," which suggests one tool could be minimum prices for Chinese cars, The Guardian said.
The EU runs a trade gap with China of about €1.18 billion a day. Šefčovič will brief EU diplomats on Sunday ahead of a leaders' summit on Thursday.
What we know: the goal of cutting hybrid exports by more than half.
What we don't: whether it will use quotas, minimum prices or something else.
Where outlets agree The Guardian and Politico both report the EU says the deal could cut China's hybrid exports to the bloc by more than half over four years.
Where they differ The outlets cited here report the same key facts so far.