The Tuesday Special — Tuesday, August 25, 2026

Good morning, Adam. On July 13, 2026, Transport & Environment published its review of how well the EU tariffs on battery-electric cars imported from China have worked, in force since 2024. The result is clear. Cars built in China accounted for 17 percent of the European BEV market in the first quarter of 2026, down from a peak of 22 percent in 2024. Here is the interesting detail: the decline comes largely from Western brands. Tesla, BMW and Volvo have moved production from China to Europe. Their share of Chinese-origin BEV imports fell from 38 percent in 2024 to 23 percent in the first quarter of 2026. This is a supply chain realignment, far from a flight out of the market: the same companies stay in the segment, and the place of production changes. Meanwhile, Chinese manufacturers keep advancing. For a decision maker, that distinguishes the tariff's intended effect from a failure.

And the data speak clearly, Adam. In June 2026 the price of fuels and lubricants for personal transport rose 13.7 percent compared with June 2025. The source is Eurostat: the survey feeds the harmonized index of consumer prices, the tool that measures inflation across the Union. The category is code ECOICOP CP0722, and it covers diesel and gasoline. The harmonized base across the twenty-seven member states makes the numbers comparable between countries. Watch the dynamic: the 13.7 percent follows two hotter months, with a plus 20.8 percent in April and a plus 20.7 in May. The pace is slowing. In May, four countries recorded rates above 30 percent for this category; in June the picture looks calmer across the whole Union. Every fill-up, meanwhile, reminds the consumer what it costs to stay with combustion.

A very harsh bill, Adam. Manager Magazin reported on Friday the plan that redraws Europe's largest carmaker. Volkswagen plans to cut 100,000 jobs and end production at four German plants over the coming years: Hannover, Zwickau, Emden and the Audi site at Neckarsulm. According to CNBC, it is the most radical overhaul in the group's 89 years of history. We are talking about roughly 15 percent of the workforce: at the end of the first quarter of 2026 the group counted about 657,400 people. Investment falls too, by about 15 percent, to just over 130 billion euros across five years. Behind the number are people with context, relationships and knowledge of the processes. A workforce is a store of tacit knowledge built up over time, far more than a faceless cost line. Once that knowledge is scattered, rebuilding it is hard work.

And the movie has a precise script, Adam. In 1979 the second oil shock hit Detroit. Chrysler had committed capital to big-engine sedans while demand migrated toward Japanese compacts. In 1980 came the federal loan guarantee of 1.5 billion dollars. In 2009 the scheme repeated itself: General Motors declared bankruptcy and received about 50 billion dollars from the United States Treasury. The structure stays identical: industrial plans calibrated to a world that has ceased to exist. Capital runs ahead, and demand sets the price of being late. On February 6, 2026 came a 22 billion write-down: three precedents are enough to call it a pattern. Capital gets burned by bets on a future the market refuses to validate, far more than by competition.

Sooner than you think, Adam. Price parity between battery-electric vehicles and combustion engines will arrive in most segments by 2027. The consensus points to 2030: the difference is worth three years, and the cost curve shows who is right. The consensus looks at the wrong number. It compares today's list price for an electric with its gasoline equivalent, and concludes that parity remains far away. The list price is a snapshot; the trajectory of cell costs is the movie. The combustion engine has already lost the cost war. The market still prices it as the reference standard, and so it buys an asset in structural decline. Whoever signs long-term supply contracts on combustion today locks capital into a technology on its way out. This is a regime change, far from a passing trend.

A story that begins long before the first car, Adam. At the end of 2023 BYD announced a precise goal: bring its Hungarian plant online within three years. In late January 2026, trial production truly started in Szeged, as confirmed by mayor László Botka; series production is expected in the second quarter. The value of the case lies in the sequence. Since 2017 BYD has produced electric buses in Komárom for customers across the continent: almost a decade of presence precedes the car factory. The company runs battery assembly plants in Fót and in Páty. In 2025 it moved its European headquarters from the Netherlands to Hungary, in the eleventh district of Budapest, with a research center on intelligent driving right next door. Hungary as the gateway into Europe: a decision made years before the first car. The strategy, here, is called patience.