Core Insights - Chinese automakers, led by BYD, are dominating the electric vehicle market in Europe with advanced technology and competitive pricing, while traditional European manufacturers maintain a foothold in the plug-in hybrid vehicle segment [1][7] - The shift towards plug-in hybrid vehicles in Europe could see Chinese companies capturing significant market share by 2035, as they continue to introduce lower-priced and longer-range models [1][7] Market Dynamics - BYD Seal U has become the best-selling plug-in hybrid vehicle in Europe, capturing approximately 5.5% market share in the first nine months of 2025 [2] - In the UK, Chery Jaecoo 7 was the best-selling plug-in hybrid model in August [2] Competitive Landscape - Traditional hybrid models like Toyota Prius, which use conventional engines and smaller batteries, often have lower purchase and operating costs compared to plug-in hybrids [4] - Chinese manufacturers are expanding production and mastering battery supply chains, making their plug-in hybrids more affordable [4] - Chery Omoda 7 is set to launch in the UK with a starting price of £32,000, lower than Toyota and Honda's hybrid models, while offering a pure electric range of 56 miles (90 km) [4] Sales Growth - The sales of plug-in hybrid vehicles in Europe have surged, with a 32% year-on-year increase in the first nine months of this year, nearing 920,000 units [5] - Electric vehicle sales also grew by 25%, reaching 1.8 million units [5] - Plug-in hybrids accounted for 10% of new passenger car sales in the region during the third quarter, with about one-seventh being new models from Chinese companies [5] Future Outlook - European traditional automakers are losing competitive edge in plug-in hybrid technology to Chinese manufacturers [7] - The EU's tightening of carbon emission regulations and the potential reduction in subsidies for plug-in hybrids may impact future demand [7] - The International Council on Clean Transportation (ICCT) reports that plug-in hybrid vehicle sales in China have surged from approximately 240,000 in 2020 to 4.9 million last year, capturing 19.5% of the new passenger car market [8] - The average range of Chinese plug-in hybrids is 116 km, compared to 78 km in Europe and 70 km in the US [8]