Lower Saxony premier Olaf Lies urges EU tariffs on Chinese hybrid cars

Call for tariffs on plug-in hybrid imports

Lower Saxony Minister-President Olaf Lies has called on the European Union and the German federal government to impose import tariffs on hybrid vehicles manufactured in China. In statements made to regional public broadcaster NDR, the Social Democratic Party (SPD) politician argued that the current trade framework leaves a regulatory loophole in European market protections. While the European Union currently levies countervailing import duties on pure battery-electric cars from China due to subsidized competitive advantages, plug-in hybrid models remain exempt from those trade measures. Lies stated that this disparity creates an uneven playing field that penalizes domestic car manufacturers. To address the issue, the state premier sent a formal letter in July 2026 to European Commission President Ursula von der Leyen, German Chancellor Friedrich Merz, and Vice Chancellor Lars Klingbeil. The letter pressed European and federal leaders to enact duties on hybrid vehicles without delay.

Regulatory gap and displacement risks

According to Lies, the European Commission made an omission two years ago during its formal investigation into state-backed market distortions. The European Union probe examined unfair competitive advantages for pure battery-electric vehicles but neglected to include plug-in hybrid models in its scope. Lies noted in his letter that Chinese manufacturers have spent the past two years systematically introducing plug-in hybrids into the European single market. He stated that foreign carmakers are using these hybrid vehicles in a targeted displacement competition to push established European manufacturers out of the market. Lies warned that failing to introduce tariffs quickly could lead to the permanent destruction of European industrial manufacturing structures over the coming years.

We expect the Commission and the federal government to structure our trade policy toward China differently.

Surge in Chinese hybrid shipments

The renewed push for trade restrictions follows a substantial increase in automotive import volumes arriving in Europe from Chinese production plants. Trade figures cited by Lies show that exports of vehicles produced in China, with plug-in hybrid models leading the expansion, grew by approximately 70 percent year-on-year in May and June 2026. Lies characterized this sharp growth as direct proof of competitive distortion taking place across the automotive sector. He argued that the absence of duties on plug-in hybrids encourages foreign manufacturers to expand their plug-in hybrid product offerings in Europe while bypassing the tariffs applied to fully electric models.

Industry strains and political alignment

The tariff initiative from the Lower Saxony state government coincides with financial and structural pressures at Volkswagen, where Lies serves as a member of the supervisory board. Lower Saxony is a key institutional shareholder in the Wolfsburg-headquartered automotive group, giving state officials a direct interest in safeguarding domestic production capacity. The appeal by Lies aligns with prior calls for trade interventions voiced by German automotive executives and regional political figures. Volkswagen Chief Executive Officer Oliver Blume previously called for the introduction of tariffs on Chinese hybrid models to maintain fair competition. Sebastian Lechner, the regional leader of the Christian Democratic Union (CDU) in Lower Saxony, has similarly called on trade officials to close the regulatory gap on imported hybrid cars.