EU and China agree to halve Chinese hybrid car exports to Europe

The European Union and China have reached a landmark trade agreement to reduce China's hybrid car exports to the EU by more than half over the next four years, aiming to address a daily trade deficit of €1.18 billion. The deal, described as the first of its kind, avoids prior WTO investigations and includes commitments on rare earths and EU food and drink access to China.

Why it matters. The agreement affects European automakers facing competitive pressure from low-cost Chinese imports and aims to stabilize bilateral trade relations without triggering a broader trade war.