The European Commission is currently developing a new economic policy alliance involving Great Britain, Japan, and South Korea. According to reports sourced from Commission circles by the newspaper “Handelsblatt”, the primary objectives of these four partner nations are to collectively defend against Chinese overcapacity in the automotive market, maintain mutual openness of their respective markets, and collaborate on the dismantling and processing of critical raw materials.
EU officials and diplomats familiar with the matter indicate that vehicles from the three partner countries are expected to receive preferential treatment under the existing “Buy European” guidelines. This planned legislation aims to restrict purchase subsidies for electric vehicles and tax benefits for corporate fleets strictly to European vehicles. Consequently, cars originating from the three partner nations would reportedly be treated identically to EU-manufactured vehicles in the future.
Furthermore, the plan includes implementing protective tariffs against rising auto imports, modeled after the EU’s existing protective measures for steel. Rules set by the World Trade Organization (WTO) provide instruments for levying such tariffs in specified situations. Bernd Lange, Chairman of the European Parliament’s Trade Committee, told “Handelsblatt” that the “EU intends to utilize this instrument together with Japan, South Korea, and other partners.”
The catalyst for this initiative is the massive surge in Chinese exports. In the first quarter of 2026 alone, 60 percent of plug-in hybrids imported into the EU originated from China. More recently, starting in May, Chinese manufacturers surpassed the combined sales volume of the major Japanese corporations in Europe.
