European industries are facing increased pressure from a surge in imports from China amid ongoing trade tensions and shifting global supply dynamics. Over recent years, Chinese manufacturers have expanded their presence across several key sectors, intensifying competition with domestic producers and prompting regulatory scrutiny within the European Union.
One prominent example involves the rapid growth in exports of plug-in hybrid vehicles from China. Monthly shipments have risen sharply from under 10,000 units to nearly 200,000 in just three years, with a significant portion destined for European markets. This influx has coincided with advancements in China’s electric vehicle infrastructure, which has reduced the reliance on plug-in hybrids domestically, allowing automakers to focus on exporting these models. Chinese authorities have opposed efforts by the EU to extend tariffs to cover plug-in hybrids as part of broader trade measures. Nevertheless, European officials are under mounting pressure to respond, particularly after Volkswagen announced on September 3 plans to cut an additional 50,000 jobs—bringing total planned layoffs to around 100,000—as it struggles to compete with Chinese suppliers.
In the renewable energy sector, the EU is conducting an investigation into imports from Goldwind Science & Technology Company, the largest wind turbine manufacturer in the world and a state-controlled Chinese enterprise. Earlier this year, the bloc issued a preliminary finding suggesting that subsidies provided by Beijing may have given Goldwind an unfair advantage in European markets. Goldwind has stated that it adheres to all relevant laws and pledged to cooperate with the inquiry. Wind turbines are one of several critical technologies addressed under the EU’s proposed Industrial Accelerator Act, legislation aimed at strengthening regional manufacturing by mandating local production of key components and limiting certain foreign investments. The act also targets solar energy, chemical industries, and others—sectors in which China has expressed strong opposition.
Concerns over dependency on Chinese supplies extend to rare-earth metals, essential for manufacturing advanced technologies such as automobiles, drones, semiconductors, and electronics. Ursula von der Leyen, President of the European Commission, emphasized the risks posed by Europe’s reliance on China, especially after Beijing imposed export restrictions on rare-earth processing equipment and technicians. In July, China further tightened controls by limiting rare-earth exports to 14 European companies, including leading German defense firms and manufacturers specializing in critical minerals such as antimony and tungsten. The impact has been tangible: Germany alone has lost an estimated 10,000 industrial jobs monthly amid weakening manufacturing performance.
European companies have also raised concerns about limited market access in China, where state-owned enterprises have increasingly displaced foreign suppliers across sectors including telecommunications, medical equipment, and pharmaceuticals. The Finnish telecom firm Nokia, for example, is scheduled to close much of its mainland China operations this autumn amid shrinking opportunities. In addition to regulatory obstacles, declining domestic demand resulting from China’s prolonged housing market downturn and industrial overcapacity has reduced profitability and dampened European enthusiasm for Chinese markets.
As Europe weighs strategies to bolster its industrial base, balancing market openness with protection of domestic industries remains a key challenge amid complex economic relations with China.