Sales of Chinese brands ranging from BYD to Jaecoo are booming, eating into the market shares of long-established brands, particularly in Europe.<\/p>\n
Analysis by the Mercator Institute for China Studies (Merics) in Berlin showed that China ran a \u20ac900m-a-day (\u00a3767m) goods surplus<\/a> with the EU in the first half of 2026, risking heightened tensions with the US and the EU, which has previously accused China of \u201cweaponising\u201d trade as foreign policy.<\/p>\n Exports to the EU increased 12.7% year on year, pushing the surplus to 1.225tn yuan (\u00a3135bn).<\/p>\n Exports of electric vehicles and hybrid cars, which escaped the EU\u2019s 2024 tariffs on Chinese EVs, have put the European industry under huge pressure<\/a>, with recent warnings of a collapse in employment in the sector.<\/p>\n Volkswagen, Europe\u2019s largest car manufacturer, is planning to reduce its 670,000-strong workforce by up to 100,000 as part of wide-ranging restructuring plans put to its supervisory board last week.<\/p>\n While proposals to close four plants were not approved by the board, their future is still under discussion as part of what the chief executive, Oliver Blume, on Monday called the \u201cmost comprehensive realignment in the company\u2019s history\u201d<\/a>.<\/p>\n Rafael Jimenez Buend\u00eda, a trade expert who analysed the figures for Merics, said the export surge into the EU beat its own forecast of record sales.<\/p>\n It had expected China\u2019s exports to the EU to reach a new first-half record of 2.12tn yuan but the data released on Tuesday put it 45bn yuan ahead, at 2.165tn yuan.<\/p>\n
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