TheChek News Flow

Oct 11 (Reuters) - Italy's Banca Monte dei Paschi di Siena (BMPS.MI), opens new tab will hold ​a board meeting late on Monday ‌to take stock of the situation after suitor Intesa Sanpaolo (ISP.MI), opens new tab pledged to hike its takeover bid and ​gained the support of some key MPS ​investors, three people close to the matter ⁠said on Sunday.

Intesa a week ago said ​it would increase by 25% the cash ​component of its €35 billion takeover bid if MPS shareholders rejected a defence plan CEO Luigi Lovaglio has proposed ​against the bid.

The board will discuss the ​latest developments, one of the sources said, adding it was ‌not ⁠clear if any further defence moves could be put to board members.

To be able to advance his defence scheme, Lovaglio has called ​a shareholder ​vote on ⁠it on October 29, where he needs a two-third majority approval. But shareholders ​holding in aggregate some 30% of ​the ⁠bank's capital over the course of the past week said they would not back the ⁠project - ​making it impossible to reach ​the necessary approval threshold.

MILAN/LONDON, Oct 11 (Reuters) - The leading shareholders in INWIT (INWT.MI), opens new tab are arranging the financing for a potential take-private deal ​of Italy's largest mobile telecom towers company, two people close ‌to the matter said, amid a contractual dispute, opens new tab between the masts firm and its two main customers.

French private equity firm Ardian and investment vehicle Oak Holdings 1, the ​latter backed by co-investors GIP, Vodafone (VOD.L), opens new tab and KKR (KKR.N), opens new tab, are exploring ​a bid to buy out minority shareholders in INWIT, the ⁠people said.

Ardian controls 32% of INWIT, while Oak Holdings controls 39%.

The investors ​are discussing the financing of the bid with banks, the people said, ​with one person adding that Abu Dhabi investment firm Mubadala is expected to take a stake in INWIT as part of the plan.

The people cautioned that deliberations ​are still ongoing.

Ardian, GIP, Vodafone (VOD.L), opens new tab, KKR (KKR.N), opens new tab and Mubadala declined to comment. GIP ​is part of US investment firm Blackrock (BLK.N), opens new tab.

An INWIT spokesperson said the company did not ‌have ⁠any information on the matter.

INWIT, which listed in Milan in 2015, has been the subject of takeover speculation since a French media report in February that infrastructure fund Ardian and investment group Brookfield were interested in taking ​the Italian company ​private.

INWIT has since ⁠then become embroiled in a dispute with its two main customers, Telecom Italia (TIM) (TLIT.MI), opens new tab and Swisscom's Fastweb (SCMN.S), opens new tab, both of which ​have initiated procedures to terminate their respective contracts with ​INWIT ⁠as part of efforts to renegotiate them on more favourable terms.

INWIT's market value has fallen about 27% over the past year to $7.1 billion (€6.3 billion) as ⁠of ​Friday's close, according to LSEG data.

Amos Kipruto and Hawi Feysa won the men's and women's races on Sunday in the Adidas Adizero Adios Pro Evo 3.

Both the men’s and women’s Chicago Marathon winners raced to victory in the Adizero Adios Pro Evo 3 super shoe on Sunday as the German brand continued to dominate the season.

Kenyan runner Amos Kipruto won in the Windy City after previously placing both second and third in the race. He recorded a personal best of 2:01:09, beating his 2:01:29 finish in London in April.

In the women’s race, Adidas runner Hawi Feysa was the winner for the second year in a row, crossing the finish line in 2:13:33.

Over 55,000 runners competed in the 26.2 mile race, which started and ended in Chicago’s Grant Park.

The latest achievement for Adidas comes after the brand swept the men’s and women’s podiums in Berlin last month — the first time since 2017 that one brand was worn by all six top competitors.

The Adidas Adizero Adios Pro Evo 3 led three runners to historic highs in London, with Sabastian Sawe — the race’s men’s winner — and fellow three-stripes athlete Yomif Kejelcha both breaking the sub-2-hour marathon barrier for the first time. In the women’s race, Adidas runner Tigst Assefa set a women’s-only world record of 2:15.41.

The much-buzzed-about super shoe debuted for the first time in London. The super shoe weighs just 97 grams for a men’s size 9.5 and improves running economy by 1.6 percent compared to the Pro Evo 2. Most of the reduction comes via a new Lightstrike Pro Evo foam compound that’s 50 percent lighter than its predecessors, and designers took inspiration from kitesurfing sails to create a feathery woven upper.

Following the departure of creative director Anthony Vaccarello, the Paris house is expected to tap Chemena Kamali to focus on women’s daywear, menswear, high-end leather goods — and Asia.

PARIS — The next designer at Saint Laurent has already been selected and is expected to focus on women’s daywear, menswear and high-end leather goods as the Paris-based house plows into underpenetrated markets like Asia, and especially China.

That’s what equity analysts were told Friday morning after Kering revealed the departure of the brand’s star designer Anthony Vaccarello.

“The decision was driven by the longer-term prospects for Saint Laurent and is unrelated to any recent financial performance of the brand,” Barclays analyst Viktoria Petrova wrote in a research note following the sell-side call.

“Because of the current skew to carry-over leather goods, Kering expects no disruption to the Saint Laurent product pipeline from the creative transition,” she added, characterizing the forthcoming handover as “well-planned.”

Luca Solca, luxury analyst at Bernstein, expressed a more skeptical view.

“One could argue that after so many years, Vaccarello could be replaced in the interest of newness at Saint Laurent,” he told WWD. “But given the poor track record Kering has accumulated in appointing creative directors (Sabato De Sarno at Gucci, Alessandro Michele at Valentino), this in my view adds problems to problems.”

In his view, the exit of Vaccarello comes at a difficult time for the French group since “Gucci has yet to find a convincing direction, Balenciaga is having its own share of problems, and Alexander McQueen is going through a major restructuring.”

That said, he characterized Saint Laurent as a “very good brand, that has developed materially since Kering (then PPR) had acquired it more than 25 years ago. Look at its business in beauty under L’Oréal.”

Friday’s announcement came on the heels of a Paris Fashion Week dominated by speculation that the Belgian designer would bow out after an acclaimed 10-year tenure.

Vaccarello’s all-gold spring 2027 show — the collection marching under three monumental chandeliers and in the shadow of a twinkling Eiffel Tower — felt like a swan song, official or not.

The Kering statement said Vaccarello “played a key role in Saint Laurent’s development, helping to strengthen its identity and influence across the worlds of fashion and culture,” and adding that it would soon unveil its new creative leadership.

Chemena Kamali, currently Chloé’s creative director, is widely expected to succeed Vaccarello and is no stranger to the house, having served as women’s ready-to-wear design director under Vaccarello from 2016 until 2023, when she landed the top job at Chloé.

“I would like to express my sincere gratitude to Anthony for his contribution to Saint Laurent over the past 10 years,” Luca de Meo, chief executive officer of Kering since September 2025, said in Friday’s statement. “Through his creative vision and exacting standards, he has contributed to strengthening the enduring influence of one of France’s greatest couture houses, as we embark on a new chapter in its history.”

Cédric Charbit, president and chief executive officer of Saint Laurent, also “warmly” thanked Vaccarello for this dedication to the house.

“During his tenure, Anthony took Saint Laurent on a remarkable trajectory, elevating the house to the forefront of desirability and image, while accomplishing exceptional work both creatively and through his cultural impact,” he added.

The prospect of a Vaccarello exit was viewed with a jaundiced eye by some fashion insiders, given the Belgian designer’s large fan base, and multiple signs of its fruitful collaboration.

The house orchestrated a host of magazine covers and features this year linked to Vaccarello’s 10-year anniversary at the house, and was on the cusp of releasing a slick, 90-minute documentary about the designer’s winning approach, produced by Terminal 9 Studios.

The Lyst Index, a ranking of fashion’s hottest brands and products online, had Saint Laurent in its top five for the last 10 quarters.

Vaccarello is to receive the International Designer of the Year trophy at the 2026 CFDA Fashion Awards on Nov. 2 in New York City, and he is one of six nominees for Designer of the Year at this year’s Fashion Awards, a fundraiser for the British Fashion Council, scheduled for Nov. 30 in London.

Kering, parent of Bottega Veneta, Balenciaga, Brioni, McQueen and several jewelry houses, no longer breaks down revenues by brand except for Gucci, but noted that Saint Laurent returned to growth in the first half of 2026.

“The house delivered a solid performance in North America and in Western Europe and benefited from strong client demand, as the new collections continued to gain traction,” it said in a statement last July.

At comparable exchange rates, 2025 revenues at Saint Laurent slipped 6 percent in 2025 to 2.64 billion euros, versus a 19 percent drop for Gucci.

A designer partial to the hot-blooded, daring side of fashion, Brussels-born Vaccarello studied sculpture at La Cambre, and came onto the international fashion radar in 2006 when he won first place at the Hyères International Festival of Fashion and Photography for his collection inspired by Italian porn star La Cicciolina.

He subsequently went on to work at Fendi and in 2009 launched his namesake collection in Paris, earning a reputation for racy, abbreviated dresses and skirts. Two years later, he scooped the ANDAM fashion award, and in 2013 was recruited by Donatella Versace to rev up the Versus brand.

Once settled into Saint Laurent, he became one of Paris Fashion Week’s most formidable showmen, erecting gobsmacking sets at the foot of the Eiffel, installing a monumental waterfall one season, a giant hedge of hydrangeas in the house’s Cassandra logo the next.

He evoked the essence of Saint Laurent with strong-shouldered tailoring, meaty leather jackets and faux furs, bold colors, wispy cocktail dresses, hulking costume jewelry and killer heels, usually concentrating each show on a particular silhouette or juicy slice of brand lore.

Unusual for a French megabrand, he almost never featured handbags on the catwalk — a wallet at most — although the brand sold many Sac de Jour, Icare, Amalia and 5 à 7 models.

WWD broke the news last February that the brand quietly recruited Johnny Coca, one of the industry’s most prominent and accomplished handbag designers. He previously worked for Louis Vuitton, Celine and Mulberry.

Vaccarello kept an iron grip on Saint Laurent’s image — party photos were always in black and white only — while also widening its cultural affiliations, most dramatically by establishing Saint Laurent Productions in 2023 to produce short and feature-length films by the likes of Jim Jarmusch, Pedro Almodóvar and Jacques Audiard.

In its short life, the production company has already multiple international awards for “Emilia Pérez” and “Father Mother Sister Brother.”

Vaccarello also established Saint Laurent Editions, specializing in books, fanzines and fine art, with a dedicated retail/gallery space dubbed Saint Laurent Babylone on the Left Bank of Paris.

His inner circle included the likes of Madonna, actress Zoë Kravitz and Connor Storrie, models Kate Moss and Anja Rubik, singers Rosé and Charlotte Gainsbourg, plus such legendary figures from the days of Yves as Catherine Deneuve and Betty Catroux.

The designer is known primarily for his women’s designs, though he recently plied more energy into Saint Laurent menswear, staging intimate shows at the Pinault family’s Bourse de Commerce art museum, and drawing inspiration from the founder’s signature style, and his womenswear collections.

Considered one of the holy grails of Paris fashion, Saint Laurent owes its prestige and fame to a founder who once had such a tight trip on fashion that if he made a slight change in a hemline or a subtle shift in a waistline, the repercussions rippled around the globe.

Yves Saint Laurent is often cited as the inventor of ready-to-wear through the launch in 1966 of his Rive Gauche collection. He became known for beatnik fashions, safari jackets, his landmark Ballets Russes collection, his unparalleled sense of color combinations, the artistry of his cut, designer denim and the launch of a significant fragrance and beauty business with a designer name.

Successors to the legendary couturier, who retired from couture in 2002 and died in 2008 at the age of 71, also included Alber Elbaz, Tom Ford, Stefano Pilati and Hedi Slimane — who logged two tenures: heading up the label’s Rive Gauche Homme collection in the late ’90s, and then returning from 2012 to 2016 for a vast “reform project” that included abbreviating the brand name.

It is understood Kering plans to build on the foundation left by Vaccarello, also spying additional opportunities in jewelry.

At the group’s Capital Markets Day last April in Florence, de Meo told analysts and press that “the next chapter is how to reawaken and reinvigorate icons, to transform them into iconic products that go beyond fashion cycle.”

In addition, Saint Laurent is aiming to double its sales to VICs by 2030, and to double its business in Asia within the same time frame.

Charles de Gaulle airport owner linked to services for sanctioned airline

Subsidiary of Groupe ADP, which is backed by the French government, has not stopped all work for Russia’s Ural Airlines

An airport operator backed by the French government has received fees from Russian and Iranian airlines placed under sanctions by the EU and US, highlighting the limits of western blacklists targeting Moscow and Tehran.

TAV Airports — a subsidiary of French state-controlled Groupe ADP — has continued to service flights by Russia’s Ural Airlines at Antalya airport in Turkey, through a joint venture with Germany’s Fraport, despite the carrier having sanctions imposed by Brussels in June 2024. Groupe ADP’s flagship asset is Paris-Charles de Gaulle airport.

The operators collect fees from airlines for providing services such as boarding and security, although Turkish aviation authorities control which flights can land at the airport.

At least 54 Ural flights have been listed on the airport’s online arrival and departure board for locations such as Volgograd and Moscow since September 21.

TAV’s wholly owned subsidiary, Havaş, is also listed as Ural’s ground-handling provider at Antalya.

The EU sanctions on Ural — part of a crackdown on Russia following its full-scale invasion of Ukraine — initially applied only to entities within the bloc, meaning the actions of overseas subsidiaries such as Turkish-incorporated TAV were not in scope.

Brussels later added a requirement for companies to make their “best efforts” to ensure they do not “undermine” sanctions tied to the war through their non-EU entities. This has applied to Ural since February 2025.

Companies that fail to do so “may be subject to legal penalties”, according to European Commission guidelines that define “best efforts” as “all actions that are necessary and feasible”.

One senior international trade and sanctions lawyer said the actions of Groupe ADP “would appear, at least, to go against the spirit of the EU sanctions”.

Groupe ADP said it “is ensuring strict compliance with applicable regulations and sanctions”.

TAV said it did not violate sanctions and “places the utmost importance on sanctions compliance”.

The company said it had no control over which airlines use Antalya airport, which was a decision for Turkish authorities. It added that where a sanctioned airline operated flights to Antalya, TAV provides “only the minimum level of services as required by local regulations and governmental contractual obligations and imposed by civil aviation authorities, without violating any US or EU sanctions requirements”.

EU law provides some leeway in situations where a company is unable to “exercise control” over a non-EU subsidiary for reasons outside its control such as local legislation.

The senior international sanctions lawyer said a “mere contractual obligation” was “unlikely” to be enough to allow an EU entity to succeed in arguing that it was unable to exercise control of a non-EU subsidiary.

Fraport said it was “in full compliance with applicable laws and regulations” and “remains committed to conducting its business in accordance with applicable sanctions regimes and all relevant legal requirements”.

While EU sanctions are set in Brussels, enforcement is left to the member states.

France’s economics and finance ministry and L’Agence des participations de l’État — which manages the state’s corporate investments — declined to comment. The European Commission declined to comment on an individual case.

Interactions with sanctioned airlines have come under increased scrutiny in recent weeks after the US blacklisted 27 Iranian carriers in a bid to maximise pressure on Tehran.

At least eight of the companies targeted by Washington have historically used Turkish and Georgian airports with TAV-operated terminals and continued to do so in the weeks after the US designations on September 8.

Most of the routes appear to have now closed, although, for example, a Meraj Airlines flight travelled from Tehran to Ankara airport, which TAV operates, on Monday October 5 before returning overnight to Iran.

TAV said it had “stopped providing services” to the Iranian airlines sanctioned by the US on September 8 “within our scope of control”.

US primary sanctions apply only to American people and companies. But under secondary sanctions Washington can target overseas organisations that it deems to have “materially assisted” a sanctioned entity, cutting them off from the US banking system.

The senior international sanctions lawyer said Groupe ADP and its subsidiaries “could be at risk” of secondary sanctions if the US decided they met its legal test of having “materially assisted” a designated entity.

A senior US sanctions lawyer said Washington would be “highly unlikely” to impose such sanctions due to the diplomatic risks of targeting a Paris-backed group.

Secondary sanctions were typically a diplomatic tool to “cajole and influence” foreign countries and companies, rather than being formally deployed, they said.

“That said, it’s the Trump administration . . . it put the Turkish defence ministry under sanctions in its first term and used that as leverage,” they added.

A US Treasury official said: “We don’t preview potential sanctions actions, though we are monitoring these issues closely and take any and all potential allegations seriously.”

Heathrow needs Burnham green light for runway by end of year, warns boss

Airport will have to ‘reassess’ £33bn project if prime minister does not openly back expansion plan, Woldbye tells FT

Heathrow’s investors will reassess plans to build a third runway if Andy Burnham does not give explicit backing to the ambitious £33bn project by the end of this year, the airport’s boss has warned. 

Thomas Woldbye told the FT that the backers of Britain’s only hub airport “cannot wait forever” for commitment from the prime minister, who has so far declined to support the new runway, in contrast with Sir Keir Starmer’s administration.

Heathrow’s owners — which include Ardian, Qatar’s investment authority, Saudi Arabia’s PIF and Singapore’s GIC — must decide in the new year whether to submit a formal planning application for a third runway. 

“Our shareholders would like to do this,” Woldbye said in an interview. “They do think that things are taking a long time, and so far they have decided to be OK with that . . . But of course we cannot wait forever.” 

He added: “At some point in time we need a level of certainty. I think by the end of the year we’ll be looking and saying, ‘Let’s assess this, let’s take stock and see where we are’.”

New chancellor John Healey has said an expanded airport would boost growth, but Burnham has avoided questions so far on whether he supports the plan, which is opposed by environmental campaigners and Labour Mayor of London Lord Sadiq Khan.

The FT previously reported that Burnham told several Labour MPs that he had always opposed the idea.

Speaking before the Holborn and St Pancras by-election in which Labour defeated the Green Party, Burnham said the runway was a “matter for London” despite Starmer being a firm supporter of the scheme. 

Without the premier’s explicit backing, it will be very hard to push the project through the planning and legal processes required to get approval to start construction work. 

Heathrow has stressed the economic benefits to ministers, including 100,000 new jobs and a fillip to GDP, while it forecasts that 60 per cent of the economic benefit will be felt outside of London. 

Woldbye said supportive figures within the government were “clear” about the benefits of the scheme, for which political support has ebbed and flowed over the past two decades. 

He added: “I’m not a politician; there may be other reasons why [Burnham] is not committed to that right now. But of course there is a point where we would probably look and say, ‘We need to commit’. It may not be the highest on his agenda, but I think we can get it up there because that is where it belongs.” 

Several key processes need to be completed before Heathrow and its investors push the button on a planning application. 

MPs on the House of Commons transport committee are scrutinising a new policy framework that would allow the airport to build a new runway, while the Civil Aviation Authority, the sector regulator, is exploring changes to Heathrow’s model for clawing back investment costs.

Heathrow is also holding its own consultation on the project, which closes in December. 

Former chancellor Rachel Reeves, who resurrected the idea of a third runway in 2025 to help boost the economy, set out a timeline for building work to start by 2029, with a new runway partly operational by 2035.

Delays to the process mean Heathrow has already pushed the earliest opening date for the runway to 2039. 

Woldbye said hitting the 2029 deadline for planning permission would be “challenging” but “we are working to 2029 and can see a path to 2029 now”. Meeting the deadline would “require the government to be clear,” he stressed. 

The independent Climate Change Committee warned last month that Heathrow expansion was incompatible with the government’s climate targets, and that it would produce as much CO₂ as Birmingham, the UK’s second city. 

The Department for Transport said it supported “airport expansion across the country where this can contribute to growth and opportunity, while meeting tests on the environment”.

“We are moving swiftly to review the responses received to the recent consultation on the policy framework underpinning expansion, and considering the appropriate next steps,” it added.

Amazon in Talks to Buy AI Startup Decart for Around $7 Billion

San Francisco company’s software makes it easier for developers to switch between different AI chips

Amazon.com AMZN 3.29%increase; up pointing triangle is in talks to acquire artificial-intelligence startup Decart in a deal that could be valued at around $7 billion, according to people familiar with the matter.

San Francisco-based Decart’s software makes it easier for developers to switch between different AI chips, a capability that is becoming increasingly important as companies race to secure more computing power.

A deal could come together soon, the people said, assuming talks don’t fall apart or another suitor doesn’t emerge.

Decart has raised more than $400 million in venture capital funding from investors including Sequoia Capital, Benchmark and Radical Ventures, according to PitchBook. It was valued at nearly $4 billion in May.

The company was founded in 2023 by three Israeli engineers, brothers Dean and Orian Leitersdorf and Moshe Shalev. Decart is also developing world models called Lucy and Oasis. World models can generate and simulate real-world 3-D environments.

Amazon has developed its own custom AI chip, Trainium3, in competition with Nvidia, which continues to dominate the market for graphics processing units, the specialized chips powering the AI boom. Amazon Web Services gave Decart early access to the chip in 2025 after meeting with the company and being impressed by its founders, The Wall Street Journal has reported.

Amazon’s other sizable acquisitions in recent years include a $6.5 billion deal for the MGM movie and television studio in 2022 and a roughly $11 billion deal for Starlink rival Globalstar announced earlier this year.

Israeli news outlet Calcalist reported earlier this month that Decart was in advanced talks to be sold to a major technology company.

EU ‘safeguards’ hybrid car sector from Chinese imports under new deal

Auto sector welcomes ‘understanding’ reached with Beijing but other industries warn China’s huge trade surplus will persist without further action

The EU will impose a quota on imports of hybrid cars from China with Beijing’s tacit agreement as part of an “understanding” achieved by the two sides that averted a full-scale trade conflict.

Three people briefed on the deal sealed on Friday said that, if member states approve it, the EU would deploy a trade “safeguard”, a measure that can be applied without evidence of market abuse and would mean China could only export a limited number of vehicles before steep new supplementary tariffs kick in.

China would accept an agreed quota under the measure and would not retaliate against EU imports because of it, the people said.

Announcing the deal in Beijing, EU trade commissioner Maroš Šefčovič said China had agreed to restrict its hybrid exports under what the two sides called the “understanding” reached during two days of high-stakes negotiations.

The FT reported before last week’s talks that Šefčovič was seeking a deal based on safeguard measures after China rejected a proposal that it voluntarily limit hybrid vehicle exports to about 15 per cent of the EU market — down from about a third now.

Šefčovič said on Friday the agreement would more than halve projected exports over the next four years, reducing the number of hybrids shipped by China by “several millions”. On the current trajectory, Chinese exports to the EU would hit 800,000 this year.

In 2027 alone, the deal would reduce imports by between 500,000 and 700,000 vehicles, cutting the EU’s expected trade deficit by between €10bn and €14bn, according to an EU official.

The 2027 annual quota was expected to be initially around 350,000 vehicles, increasing by 6 per cent a year for the following three years, the official said.

The EU’s trade deficit in goods with China hit €360bn in 2025 and has grown since. In the second quarter of 2026, it was €103bn, up from €93bn in the same period last year. Vehicles and machinery were the biggest contributors.

Šefčovič said Friday’s deal would be a “blueprint for the next phase” of talks and had proved negotiations with China could bring results.

Hybrid car imports have been on course to hit around 800,000 units this year, up from 300,000 in 2025.

The European Automobile Manufacturers’ Association (Acea) has welcomed the deal. Sigrid de Vries, Acea director-general, said it could “help facilitate the transition to a new era of Chinese presence in the European market in an orderly way and this is in the long-term interests of all parties”.

“The sudden and rapid rise in imports of plug-in hybrid electric vehicles and hybrid electric vehicles from China is having a destabilising effect on the European car market,” the lobby group said.  

The share of the EU market for plug-in hybrid electric vehicles controlled by Chinese imports rose to 25 per cent in the first half of this year and for other hybrid electric vehicles to 14 per cent, both up from 2 per cent in 2024.

Chinese official media praised the deal, with the Communist Party’s Global Times tabloid hailing it in an editorial as “a pragmatic step to properly handle bilateral differences” achieved “against the backdrop of a sluggish global economic recovery and undercurrents of anti-globalisation”.

The talks in Beijing showed the EU and China had the “wisdom” to manage differences and prevent escalation, state news agency Xinhua said.

However, Europe’s chemical industry, which has filed a record number of trade complaints against China this year, said the deal “should be the first step towards broader and lasting relief for the sectors facing the greatest pressure”. 

“Europe’s China challenge is far from solved. The chemical sector needs urgent breathing space. In 10 years, our chemical trade balance alone with China has swung from a small surplus to a deficit of more than €15bn in 2025,” industry lobby group Cefic said.

Many analysts say that when EU leaders gather in Brussels for a summit this week, they would be unwise to reduce pressure on China based on just one sectoral deal.

Several member states have been calling for tariffs on more Chinese products. And before Šefčovič’s visit to Beijing, France and Germany produced a joint paper urging a new “last resort” defence tool that would cut market access entirely for some Chinese trade to deter retaliation.

They claim China has subsidised industries and is over-exporting to compensate for sluggish domestic demand — accusations Beijing vigorously contests.

Michael Pettis, a senior fellow at the Carnegie Endowment for International Peace, said the EU’s difficulty with Chinese imports was a “systemic one and not sectoral”. The agreement did not address China’s demand imbalances arising from its weak domestic economy that was leading it to tap export markets for its factories, Pettis wrote on X.

The European Policy Centre think-tank has urged EU leaders not to relax.

“Unless the European Council uses this reprieve to set a timetable for rebalancing and corrective action, this will be a tactical win for Beijing,” wrote the centre’s Georg Riekeles and Ian Hernandez in a blog post.

“Nothing announced so far changes the fundamental imbalance,” they wrote. “Beijing has turned down the heat just enough to keep Europe in the pot. But the frog is still boiling.”

‘When it matters, we have found solutions together’, Oliver Blume says ahead of Paris Motor Show

Volkswagen’s chief executive has called for greater co-operation between France and Germany to strengthen European competitiveness, saying it was not too late to respond to the threat posed by Chinese competitors. 

The Élysée Palace and the Chancellery have been negotiating for months on EU proposals for phasing out combustion engines and incentivising carmakers to build vehicles within the bloc amid an influx of Chinese cars.

But progress has been slow and the two countries remain at odds over what “Made in Europe” should really mean. 

“When it matters, we have found solutions together,” VW boss Oliver Blume said ahead of the Paris Motor Show, where some 40 per cent of the car brands in attendance are from China. “We need that again . . . between France and Germany.”

“Our future is not fixed,” Blume said, adding that Europe can still fight back with the Made in Europe proposals, more flexible climate policy and lower energy costs. 

BYD and other Chinese manufacturers have made rapid inroads into European markets, seeking higher profits through exports during a severe downturn in their domestic market. 

After the EU imposed higher tariffs on EVs made in China, Chinese carmakers rapidly expanded sales of plug-in hybrids. In the first half of 2026, Chinese carmakers seized a 25 per cent share of the EU’s market for the powertrain compared with just 2 per cent in 2024, according to the European Automobile Manufacturers’ Association. 

Brussels and Beijing have since agreed that China will restrain its hybrid car exports to the EU to half or less than that currently projected by the EU over the next four years.

Blume said he welcomed the progress in the EU-Beijing trade talks, but added: “Europe must still ensure a level playing field in its own markets. Those who sell here should compete under comparable conditions and create jobs and value here in Europe too.”  

Europe’s largest carmaker has embarked on a historic restructuring aimed at increasing its competitiveness. It is seeking to share more components and technology across the brands in the VW group, and will shed up to 100,000 jobs.

Speaking at the same event, French industry minister Sébastien Martin hailed joint European efforts to set up “ramparts” to help the bloc’s car industry grapple with “the Asian competition that is hitting the European market”.

But he also doubled down on France’s position that any Made in Europe proposals benefiting production in the bloc had to be strictly defined as the 27 member states rather than including trading allies or countries like the UK, Turkey, Japan and South Korea, where manufacturers also have plants. 

“If it’s Europe of the 27 and several countries on the other side of the world, Europeans are not going to understand that,” Martin said. 

France and Germany have been haggling over this point. One quid pro quo to agree on a deal could be if Paris agrees to soften emissions rules for cars in 2030 and 2035 to in favour of alternative fuels or plug-in hybrid cars, people familiar with the talks have said.