China and the European Union agreed on steps aimed at resolving their dispute over imports of Chinese-made electric vehicles, with Brussels outlining what it said would be the framework for Chinese automakers to make proposed price offers. In a move intended to reduce tensions created by an earlier anti-subsidy investigation, the EU issued a “guidance document” on Monday for Chinese EV manufacturers about how to submit those offers for battery electric vehicles, including minimum import prices and other details.
EU officials said the minimum prices would be designed to address alleged harm from subsidized competition. The EU said that minimum import prices must be set at a level “appropriate to remove the injurious effects of the subsidization,” and it said Chinese companies’ investment plans within the EU would also be considered as part of the review.
European Commission spokesperson Olof Gill said the policy was meant to keep the market open while applying what he described as a fair competitive standard. “The European market is open to electric vehicles from all around the world, provided that they have come here according to that level playing field,” Gill said. “If those conditions are met, then we can look at price undertakings in a serious way.”
The European Commission said it would evaluate each offer in a manner meant to comply with trade rules and anti-discrimination requirements. The EU said the Commission would assess each offer in an “objective and fair manner, following the principle of non-discrimination” and in line with World Trade Organization rules.
China responded by framing the steps as beneficial for trade relations and the broader international order. A statement by China’s Commerce Ministry said the guidance was “conducive not only to ensuring the healthy development of China-EU economic and trade relations, but also to safeguarding the rules-based international trade order,” according to the EU’s summary of the exchange. The China Chamber of Commerce to the EU welcomed the move and said it would bring about a “soft landing” in the EV standoff.
The dispute has weighed on ties between China and the bloc since the EU imposed countervailing tariffs following an anti-subsidy investigation. In late 2024, the EU introduced tariffs of 7.8% to 35.3% on Chinese battery electric vehicle imports for a five-year period. EU officials said low-priced Chinese EVs entering the European market reflected “unfair” subsidization that threatened economic injury to European auto manufacturers.
The announcement also arrived after the EU said last month it opened a review into whether a price undertaking offer submitted by Germany-based Volkswagen’s Chinese joint venture could potentially replace the anti-subsidy tariffs applied to its China-built EVs. Analysts said the guidance’s “minimum prices” approach could affect how much room Chinese brands have to compete on price while continuing to export to Europe.
Rico Luman, a senior economist at the Dutch bank ING who focuses on transport, logistics and the automotive industry, said in an interview that the minimum prices offer Chinese brands “probably some comfort to continue their exports long term … while avoiding higher import tariffs.” Luman also said he believed Chinese brands would continue to make inroads and described the EU’s and China’s balancing challenge as avoiding frustrations while keeping the trade relationship stable.
Stephen Chan, an associate director at S&P Global Ratings, said some European demand for China-built vehicles could be constrained if the approved price floor under the new guidelines “significantly narrows the gap between Chinese BEVs (battery EVs) and European rivals.” Chan’s assessment pointed to the central role that the eventual floor price could play in pricing competitiveness between Chinese brands and European automakers.
The potential market impact is also tied to the scale of Chinese EV sales growth in Europe. Chinese car brands accounted for 6% of sales in the EU in the first half of 2025, according to the European Automobile Manufacturers’ Association, or ACEA, and S&P Global Mobility—up from 5% in the same period of 2024. EU-based manufacturers accounted for 74% of total EU car sales in the first half of 2025, ACEA said, with Germany producing about 20% of the cars sold in the EU, followed by Spain, Czechia and France. By 2030, the consultancy AlixPartners said Chinese automakers are likely to double their European market share to about 10%.