Chinese automakers made up over 11% of new car sales in Europe in August 2026, according to data reported by Bloomberg on September 23. This increase is largely due to the growing popularity of hybrid and plug-in hybrid vehicles, which are not subject to the higher tariffs imposed by the European Union on fully electric vehicles from China. In August, Chinese brands accounted for 25.45% of all hybrid cars sold in Europe and one-third of all plug-in hybrids. This is a sharp rise from 2025, when their share of the plug-in hybrid market was less than 3%. In the United Kingdom, Chinese automakers now hold over 20% of the market, while in Germany, their share reached 6.4%. In France, however, their presence remains lower, hovering around 5%. To avoid losing out on environmental incentives for electric vehicles, Chinese carmakers have shifted their focus toward hybrid models. For example, in France, MG’s hybrid models accounted for 83.6% of its sales during the first half of 2026, while plug-in hybrids made up about 60% of BYD’s registrations in the country. This strategy allows them to remain competitive in European markets without facing the same financial penalties as fully electric models. In addition to adjusting their product offerings, Chinese automakers are also working to localize production in Europe to avoid import duties. Companies like Stellantis and Leapmotor are exploring the possibility of producing electric and hybrid vehicles in European facilities, particularly in Spain. Chery, for instance, has reactivated the former Nissan plant in Barcelona to manufacture its SUV models, the Omoda 5 and Jaecoo 7. BYD has also begun test production in Szeged, Hungary, for models such as the Dolphin Surf and Atto 2, with full-scale production expected by the end of 2026. European regulators are closely monitoring this trend. Officials in Brussels are already considering extending customs surcharges to hybrid vehicles, which could potentially impact the growing presence of Chinese automakers in the region. This development highlights the ongoing negotiation between trade policies and the evolving dynamics of the European automotive market.