China commerce minister says reached 'soft landing' with EU over EV tariffs

• The EU has imposed additional duties on China-made EVs manufactured since 2024, affecting Chinese exports to the bloc
• In February 2026, the EU approved its first tariff exemption for Volkswagen's Cupra Tavascan SUV (made in China) in exchange for a minimum price and annual quota model
• China is calling on the German automotive industry to pressure the EU to respect free competition and comply with WTO rules regarding the tariff structure

Summary

Key Development: Chinese Commerce Minister Wang Wentao announced that China and the European Union have reached a "soft landing" regarding EU tariffs on Chinese electric vehicles, following a Monday meeting with Hildegard Muller, president of Germany's Association of the Automotive Industry.

Main Points:

• Wang urged the German automotive association to leverage its EU influence to ensure compliance with WTO rules and modify "inappropriate provisions" in the tariff framework
• The European Commission has imposed additional import duties on China-made EVs since 2024
• In February 2026, the EC granted its first exemption to Volkswagen's Cupra brand for the Tavascan SUV Coupe, manufactured in China, using a minimum price and annual quota model to bypass tariffs

Market Implications:

The "soft landing" suggests easing trade tensions between China and the EU over electric vehicle imports, potentially benefiting both Chinese EV manufacturers and European automakers with China-based production. The Volkswagen Cupra exemption sets a precedent for other manufacturers to negotiate similar arrangements through pricing and quota commitments.

Sectors Affected:

• Electric vehicle manufacturing
• Automotive industry (particularly German automakers)
• EU-China trade relations

Outlook:

The diplomatic language and exemption mechanism indicate both sides are seeking practical solutions to avoid a full-scale trade conflict while addressing EU concerns about Chinese EV competition. German automakers, heavily invested in Chinese manufacturing, stand to benefit from continued negotiations and potential tariff relief arrangements.