China and EU agree on minimum EV prices from June 2025 instead of 45% tariffs. EU investigated Chinese subsidies like loans, grants, tax breaks enabling below-market EV prices. Subsidies distort market and threaten Volkswagen, Stellantis, Renault. Germany opposed tariffs due to China ties and WTO rules. Minimum prices preserve Chinese profit margins unlike tariffs. Chinese firms shift from cheap mass models to premium for Europe like BYD luxury sub-brands. Risks include circumvention via third countries or offshoring assembly. US Trump threatens secondary tariffs on EU-China deal. Deal avoids WTO disputes and internal EU fights. EU views it as pragmatic defense against unfair competition.