In May 2025, the European Commission formally launched an anti-dumping investigation into the import of passenger car and light‐truck tyres from China, following a complaint by EU tyre manufacturers claiming unfair price practices and harm to European producers. If the inquiry confirms dumping and injury, Brussels may adopt provisional measures within eight months and final duties within fourteen. Today, the EU’s passenger car tyre market is worth over €18 billion, and the industry supports roughly 75,000 jobs across fourteen member states.

The stakes for importers and consumers are high. In markets like Finland, where wholesalers depend heavily on Chinese supply, particularly in the budget tyre segment, the introduction of duties could upend winter-season pricing and availability. In broader Europe, importers had already paused Chinese tyre orders until August to hedge against regulatory risk.

Why the EU Is Acting And Why It Matters

European tyre producers argue that Chinese exporters benefit from state support, low labour costs, and scale advantages that allow them to undercut fair market prices. The complaint asserts that these imports undercut European firms and contribute to job losses and industrial decline. 

From China’s perspective, the move is under close watch. The Chinese Ministry of Commerce expressed “high concern,” urging that trade remedy measures be conducted prudently and through dialogue rather than precipitous restrictions. 

Yet this is more than a single industry dispute. The tyre investigation reveals how states are willing to use trade defence tools to reshape supply chains and protect strategic sectors. As global value chains grow more politically entangled, even seemingly mundane sectors can become battlegrounds.

Potential Market Shifts & Industry Fallout

If duties are imposed, Chinese tyre imports may face steep markups or exclusion from EU markets. Importers will have to absorb increased costs or pass them on to end users. In regions with seasonal demands (e.g. winter tyre seasons), supply disruptions will be especially painful.

Simultaneously, Chinese manufacturers may shift production or export routes to Southeast Asia, Africa, or other regions with more favourable trade terms, already a pattern emerging in response to US tariff pressures. 

In Europe, non-Chinese firms may gain market share, but some smaller importers and niche markets, lacking access to diversified suppliers, may see serious disruption. The supply chain could fragment further, with “China-aligned” vs. “Europe-aligned” circuits evolving over time.

Regional Spotlight: Southeast Asia & Africa

Southeast Asia

Several major tyre exporters in Southeast Asia, including Thailand, Vietnam, and Malaysia have already been hit by reciprocal US tariffs (46% on Vietnam, 36% on Thailand, 24% on Malaysia). 

As Chinese manufacturers seek alternative routes, Southeast Asian production hubs could both benefit and suffer. The region might attract redirected investment, but also become intermediate conduit zones where tyres are partially assembled before final export to Europe. That raises risk of being caught in regulatory crossfire, particularly if rules of origin scrutiny increases.

Additionally, Southeast Asian markets may see short-term supply constraints or cost inflation as Chinese suppliers redirect their output away from Europe. Local producers might gain some breathing room, but sudden cost shifts and regulatory uncertainty could hamper planning and investment.

Africa

African importers rely heavily on competitively priced tyres, often imported from China. Duties imposed in Europe could prompt Chinese exporters to redirect more supply toward African markets, potentially increasing availability but also creating over-competition for local tyre industries.

Yet this is a double-edged sword. While some African markets might benefit from surplus Chinese volumes, countries with nascent tyre manufacturing sectors could be further undercut. Those that already struggle with customs, quality control, and infrastructure may find it harder to defend local manufacturers without regional protection frameworks.

On the positive side, African economies may gain leverage in negotiating trade diversification. As Chinese exporters look for alternate destinations, Africa could secure better terms, such as local currency settlement or demand for value-addition (e.g. assembly or energy inputs) tied to supply deals.

The Takeaways & What to Watch

The EU tyre investigation acts as a warning: even seemingly modest sectors can become flashpoints in a new era of trade defence. For importers, manufacturers, and policymakers, the coming months will be critical. Watch for provisional measures — likely ranging between 15% and 30% according to analysts — and market responses. 

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More broadly, this affair underscores the fragility of global supply chains in a politicised trading environment. It illustrates how emerging markets must navigate external asymmetries, by diversifying trade, strengthening regional integration, and investing in industrial resilience.

In Southeast Asia and Africa, the tyre case will not be isolated. It may signal how future trade confrontations play out, and whether countries in the Global South can transform vulnerabilities into opportunities, by building alternative markets, capacity, and strategic alliances.

Written By:

Chloe Maluleke

Associate at BRICS+ Consulting Group 

Russian & Middle Eastern Specialist

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