China’s Response to the EV Dispute: What it Tells us about the China–EU Rivalry

At first glance, Europe’s trade conflict over battery electric vehicles (BEVs) with China may seem to be merely an industry-specific technical dispute, but the conflict has unveiled the geo-economic contestation between two major powers. To understand how the dispute contributes to the broader strategic rivalry, this study focuses on Beijing’s response to the trade dispute by examining China’s official statements. These responses provide a window into the broader international contest, revealing the underlying dynamics of China’s strategic geo-economic shift against the EU.

China’s BEV Emergence and Why it Matters for the Geo-Economic Rivalry

Since labelling China as a “systemic rival” in 2019, Brussels has increasingly viewed China’s economic influence as a security risk. Thus, to safeguard the EU’s economic competitiveness and security more effectively, the EU launched a de-risking strategy in 2023. It serves as a comprehensive strategic framework to compete with Beijing and reduce dependencies in the geo-economic sphere. At the same time, efforts such as anti-subsidy investigations and duties have been deployed as “defensive” de-risking measures. These measures are essential to counterbalance market distortions, enhance economic security, and protect industries from unfair competition.

Beijing’s increasing stake in the electric vehicle (EV) market threatens the resilience of the EU’s EV industrial policy. Over the past decade, China has experienced dramatic growth in EV battery production under the “Made in China 2025” strategy, which prioritises domestic technological innovation through heavy subsidisation of the industry. The significant governmental support has enabled Chinese carmakers such as BYD, Nio, and Xpeng to expand their BEV sales in Europe. Notably, BYD’s EV sales in August in the EU market increased by over 200% year-on-year compared to 2024, despite remaining a minority (1.3%) of the market. In view of the rapid growth, the European Commission initiated anti-subsidy investigations on 4^th October 2023 into Chinese BEVs benefiting from unfair subsidies, which could potentially damage the European EV industry. A year later, on 30^th October 2024, the EU imposed anti-subsidy duties on BEVs imported from China, concluding that “the BEV value chain in China benefits from unfair government subsidies that are causing a threat of economic injury to EU BEV producers”. Following the announcement, China initiated anti-dumping investigations into the EU’s imports of brandy, pork, and dairy products, and later imposed extra duties on these products, which were considered China’s counter-response to the EU’s restrictions on BEVs. Meanwhile, negotiations over the dispute between the two sides are still ongoing and are reportedly entering the final stage in July 2025.

China’s Strategic Shift in Diplomacy

In response to the increasing hostility abroad, China adopted new diplomatic strategies aimed at protecting its global and domestic interests. On the one hand, China perceives Brussels as a key multilateral partner, actively promoting its economic and technological achievements within the EU through official discourse. This strategy aims to improve China’s public perception in the EU as a major power, with a focus on strengthening trade ties with China in Beijing’s discourse. At the same time, following Xi’s realist emphasis on the “fighting spirit”, the need to defend China’s core interests against Western narratives has become strategically significant. Therefore, this dual strategic approach aims to position China as a global leader and to counter Western criticisms of Beijing’s growing influence. Such an approach is also applied in its discourses on the de-risking strategy and the EV dispute, where China is demonstrating its commitment to the global economy. Therefore, it is crucial for understanding how the Ministry of Commerce (MOFCOM) and MOFA respond to the BEV dispute, as their responses portray Brussels’ actions in the BEV dispute as politically motivated while presenting China as a responsible power defending the stability of global trade.

How China Responded to the BEV Dispute

China’s diplomatic strategy emphasises the strict separation between economic and political issues, where the former Chinese Ambassador to the EU, Fu Cong, claimed that “when you are in business, let’s talk about business. Let’s keep politics out of this”. In response to the EU’s anti-dumping duties, MOFCOM portrayed Brussels as an unfair and irrational global competitor. The ministry criticised the investigation into Chinese EVs as “unfair and illegitimate”. They accused Brussels’ practice of having “violated the WTO rules and disrupted the normal international trade order”. During Brussels’s investigation, MOFCOM claimed that “Chinese enterprises have been subjected to intimidation and coercive pressure, threatened with punitive high tariffs, and required to provide excessively broad information”. Thus, to demonstrate its proactiveness in resolving conflicts through dialogue, the ministry listed Beijing’s past efforts in communicating with Brussels. For example, Beijing and Brussels have already “held over ten technical consultations at the directorate-general level and two consultations at the vice-ministerial level concerning the anti-subsidy case involving EVs”. During the process, Brussels is accused of being passive by the MOFCOM and having “simultaneously and hastily rejected China’s proposals without offering any concrete counterproposals at all”, which “demonstrates a complete lack of sincerity in meeting each other halfway”. As a result, the EU’s anti-dumping duty on EVs, as part of its de-risking strategy, is described as protectionist and irrational. In the end, Beijing argued that “should consultations ultimately fail to reach consensus, the responsibility lies squarely with the European side”. Therefore, Beijing is attempting to represent Brussels as a selfish major power and itself as a responsible state that is willing to communicate.

Despite these efforts, it is crucial not to overlook China’s countermeasures against Brussels for imposing anti-dumping duties towards various EU-importing products. In this case, Ursula von der Leyen has already criticised China for saying one thing and doing another. Instead of admitting to engaging in retaliation, MOFA attempted to explain these actions by invoking global norms. For instance, they claimed that the measures against European brandy were “legitimate trade remedy actions initiated in accordance with domestic industry applications and conducted through lawful investigations, fully compliant with WTO rules”. To protect its free-trading image, Beijing utilises global norms and regulations to justify its actions aimed at safeguarding core interests, despite taking similar actions to those of the EU.

What Beijing’s Diplomacy Tells us about Geo-Economic Rivalry

The trade dispute has provided Beijing with opportunities to strengthen its global influence, which it uses to demonstrate its adherence to global norms and international regulations to resolve conflicts, while attempting to delegitimise the long-standing leading position of the Western bloc in the world order. Such a strategy has, in fact, demonstrated the “fighting spirit” that Xi advocates, aiming to “fight for international discourse” (爭取國際話語權) to defend China’s economic interests as its core interests following China’s systemic securitisation of its economic and technology sectors. Meanwhile, China claimed that Brussels was spreading false information to “brainwash” and mislead the European public, thereby forming an irrational and ideologically oriented foreign decision-making process that ultimately harms the global economy. Therefore, China’s responses are able to balance Xi’s multilateral and realist ideals, on the one hand, shaping itself as a responsible global power that is rational and contributes to the world; on the other hand, defending the interests of China’s domestic BEV industry.

At the same time, Europe remains strategically important for China, serving as a crucial component in supporting China’s ideal world order. Contrary to the hostility towards the US, which threatened that the country is ready for a trade war, Beijing still urged Brussels to resolve conflicts through dialogue, even as economic ties deteriorate. Such contrast can be explained by a kind of mutual understanding, where Beijing recognises the EU’s vulnerability due to economic dependence, and Brussels recognises this as well and adopts a more moderate approach (i.e., de-risking) compared to Washington. Therefore, the dispute no longer concerns a narrow technical issue but instead illustrates Beijing greater willingness to compromise with Brussels in the geo-economic rivalry, so that the economic ties can be preserved despite Brussels’ push for de-risking.