• February 1, 2023

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Chinese electric car makers have already established a bridgehead in Europe, tempted by high prices, and the companies are set to engage a higher gear.

The bottom end of the European electric car market is vulnerable because current manufacturers are more concerned with profits than sales, according to French auto consultancy Inovev.

SAIC’s MG began sales of mainly electric vehicles in Britain in 2017 and soon moved to all of Europe. Geely’s Polestar has also been a big player.

“The MG brand was soon joined by other Chinese brands such as (Volvo/Geely’s) Polestar and Lynck&Co, Aiways, NIO, Dongfeng, JAC, BYD, Hongqi, BAIC, Xpeng, Maxis, in short a dozen brands are now present on the European market,” Inovev said.

Chinese vehicles sold in all of Europe reached 75,000 in the first half of 2022, suggesting 150,000 is possible for the whole year, according to Inovev. In 2021, under 80,000 were sold.

Price is the key.

“Car buyers are put off by the excessively high prices of European electric vehicles. European and now Korean electric carmakers favor profit margins over volume, which leaves an entire section of the market, the least expensive cars, at the mercy of Chinese carmakers,” Inovev said in a report.


According to Schmidt Automotive Research, SAIC and Geely account for just under 9 in 10 of all Chinese battery electric vehicles (BEV) sold in Western Europe.

Europe’s carmakers failed to anticipate the local public enthusiasm for electric cars.

“Chinese (manufacturers) stand to potentially benefit from a BEV market still partially running with its hand-break on as European ones didn’t factor in growing customer sentiment for BEVs in the wake of geopolitical turbulent waters causing negative ripples when it comes to rising oil prices at the pump,” Matt Schmidt said.

“Chinese (manufacturers) could manage to achieve between 80,000 to 90,000 sales by the end of the year (in Western Europe) which would given them a market share of the regional BEV market approaching 6% in a forecast 1.6 million total market,” Schmidt said.

Western Europe includes the 5 big markets of Germany, France, Britain, Italy and Spain.

The Chinese threat will gather pace in 2025 when the next round of CO2 fleet average rules kick in and more BEVs are required in the market.

“We see the likes of MG, and perhaps BYD, more likely to have success penetrating the volume sectors lower down. From around 2027 once Europe 7 legislations for ICEs (internal combustion engines) will make it next to impossible to make a profit from gasoline ICE models,” Schmidt said.


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