BYD targets 40,000 European workforce amid hybrid curbs

A China-EU deal to limit hybrid car exports to the bloc is hitting Chinese automakers that had shifted to plug-in hybrids to avoid EU tariffs on electric cars. Analysts say the deal will push BYD and its rivals to build more cars in Europe. On Monday, BYD said it plans to hire enough people to grow its European workforce to about 40,000 by the end of 2029.tradingview+1

Chinese hybrid exports to the EU's 27 members tripled to $7.5 billion in the first half of 2026, up from $2.5 billion a year earlier, Reuters reported, citing Chinese customs data. After the EU put extra tariffs on Chinese-made battery EVs in 2024, Chinese automakers turned to plug-in hybrids, which don't face the extra duties.auto.economictimes.indiatimes+1

Conflicting accounts of the deal

EU Trade Commissioner Maros Sefcovic said on October 9, after two days of talks in Beijing with Chinese Commerce Minister Wang Wentao, that China had agreed to halve its hybrid exports to the bloc. He said the step was "preventing several millions of car exports from China to the European Union". The deal still needs approval from EU leaders, who will meet in Brussels later this week.cnbc+2

Beijing described the deal differently. On Monday, China's Commerce Ministry said it allows exports to keep growing from 2025 levels, when the EU imported 302,000 hybrids from China. It also said China's quota would be no smaller than that of any other source of imports. The ministry gave no volumes and no timeline.cnevpost

Investors mostly read the deal as easing trade tensions. BYD shares fell, while Chery and SAIC rose slightly. Citi analysts called it "a risk-relief rally story," since quotas, price floors and exemptions still have to be worked out. Jefferies summed up the shift as "tariff risk off, quota risk on".auto.economictimes.indiatimes

Shift to local production

According to Jefferies, SAIC, BYD and Chery make up more than 90% of Chinese hybrid sales in the EU. Bill Russo, founder of the Shanghai consultancy Automobility, said that if imports become harder, "investing closer to the customer becomes more attractive," but he warned that smaller players may give up on Europe.auto.economictimes.indiatimes

BYD, China's largest hybrid exporter to Europe, is already moving that way. "BYD's commitment in Europe is very deep, and it is long-term," Executive Vice President Stella Li said at the Paris Motor Show. The company is close to opening its first European factory, in Hungary. Its longer-term plan calls for three European assembly plants and a battery factory, with France and Spain under consideration for another site. A decision on that site is expected by the end of the year.tradingview

Some analysts doubt the quota will hold. "Let's see if China honours the agreement or finds workarounds," said consultant Michael Dunne.auto.economictimes.indiatimes