China’s exports of lithium-ion batteries to the European Union saw significant growth in the first nine months of 2026, driven by expanding electric vehicle production and supply chain localization by Chinese manufacturers in Europe. According to Chinese customs data released Tuesday, shipments of these batteries to the EU reached a value of $31.2 billion during this period, marking a 46 percent increase compared to the same timeframe last year. This accounted for nearly 40 percent of China’s total lithium-ion battery exports, which were valued at $78.8 billion for the first three quarters, up 42.2 percent year on year.

The surge was particularly pronounced in several central and eastern European countries, with Austria witnessing a 241 percent rise in battery imports, Bulgaria 178 percent, Hungary 156 percent, and Poland 132 percent. Industry observers attribute this growth to the ramp-up in local battery and electric vehicle production driven by Chinese carmakers establishing or expanding manufacturing facilities in Europe.

Alicia Garcia-Herrero, chief Asia-Pacific economist at Natixis, highlighted the role of Chinese automakers’ local assembly and regional supply chains in fueling battery demand across these markets. European consumer demand for electric vehicles and energy storage batteries also continues to support export growth, she noted.

This increase comes amid tighter EU import restrictions and additional tariffs on finished Chinese electric vehicles. Chinese automakers have responded by accelerating localization strategies. Xpeng operates a production line in Austria through a contract manufacturer, while BYD plans to start production at its Hungarian plant in the fourth quarter. At the Paris Motor Show held earlier this month, state-owned Changan Automobile announced intentions to expand its European production capacity over the next four years.

Garcia-Herrero suggested that persistent trade tensions and risk-mitigation policies are likely to maintain pressure on exports of finished vehicles from China, but shipments of components and intermediate goods to support vehicle production in Europe are expected to remain robust.

In the clean energy sector, China’s exports of power inverters also showed strong growth, despite recent EU efforts to exclude Chinese inverter suppliers from publicly funded energy projects due to cybersecurity and dependency concerns. In the third quarter, Chinese inverter exports to the EU rose 34.5 percent year on year to $1.7 billion. Countries such as Ireland, Portugal, Poland, Romania, and Slovakia recorded notable increases, with Slovakia’s imports from China growing more than 400 percent compared to the previous year.

Garcia-Herrero attributed this trend to the technological and cost advantages held by Chinese manufacturers and robust demand across commercial, industrial, and residential sectors within the EU. Importantly, the EU restrictions only apply to projects funded by the bloc; freely contracted commercial sales have continued to expand.

Chinese companies dominated the European inverter market in 2025, providing over 80 percent of inverters in the region, according to a British energy research firm. Globally, China’s inverter exports grew 31.9 percent in the third quarter of 2026, reaching $4.5 billion in value.