EU and China reach initial trade understandings on cars and rare earths

EU trade commissioner Maroš Šefčovič and Chinese commerce minister Wang Wentao ended two days of Beijing talks on Friday with initial understandings covering hybrid cars, European exports and rare earths. The European Commission describes a list of deliverables, not a fully implemented trade agreement.

Cars and market access

Šefčovič said the approach could more than halve projected Chinese hybrid and plug-in hybrid exports to the EU over four years, compared with an unchanged-trade scenario. That is a forecast dependent on detailed implementation and political endorsement, not a recorded cut in imports. He also described lower Chinese tariffs on selected EU goods worth almost €4 billion in current exports, with an estimated €225 million in duty savings.

A strategic supply chain

The two sides said they had a shared understanding to ease Chinese export licensing for rare earths and permanent magnets. Those inputs matter to vehicles and other advanced manufacturing. The Commission says the next ministerial consultation is planned for March 2027. For Britain, the development matters through integrated European manufacturing and global supply chains, although the UK was not party to the talks. The photograph shows the commissioners’ Beijing meeting on 8 October.