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Chinese EV startups enter European market, multiple companies preparing new products for Europe.

TraderKnows
TraderKnows
05-30

In recent years, China's electric vehicle industry has flourished, with several automobile brands using electric cars to capture the global market.

Since the 1980s, European car manufacturers have achieved great success in the Chinese market, with sales reaching millions of vehicles and almost no local competition. However, now they need to fend off the impact of strong Chinese electric car brands in the European domestic market.

According to interviews conducted by Reuters with 18 Chinese automotive industry executives, consultants, and experts, Chinese electric vehicle giants such as BYD, Chery, and Great Wall Motor are preparing to launch about 20 new products in Europe within the next five years and are investing heavily in sales and marketing in their most important export market.

After years of capturing market share from foreign competitors in the domestic Chinese market, China's electric vehicle industry is ready to challenge the European market. Chinese electric car manufacturers have been studying the needs of European consumers for years, hiring industry veterans, and choosing dealers with extensive local knowledge to lay the foundation for competing with Tesla and traditional car manufacturers. BYD and Chery have already announced plans to build factories in Europe.

Chinese car manufacturers are adopting various strategies to enter the market, including sponsoring high-profile sports events to boost brand recognition, expanding the dealer network, and enhancing service and maintenance operations to protect the value of second-hand cars, which is a critical requirement for a large number of fleet buyers in the European market.

Due to low brand recognition, Chinese car manufacturers still have relatively small sales in Europe, with MG being an exception. MG is a former British brand now owned by SAIC Motor. However, with the launch of more models across various price segments, sales are expected to grow rapidly. BYD's European sales tripled in 2023, reaching 15,000 units, following exponential electric vehicle sales growth in China and other export markets.

BYD has launched six electric vehicle models in Europe, with a company spokesperson stating that these models will be promoted in 20 countries. Mark Blundell, BYD's UK Marketing Manager, said three models were first introduced in the UK last year, with plans to launch two new models this year.

Great Wall plans to introduce one new model in Europe each year over the next five years, as revealed by two dealers to Reuters. Chery's European General Manager, Jochen Tueting, said the company will launch eight SUV models in Europe over the next two years, covering two brands: Omoda and Jaecoo.

In contrast, Tesla's main models in Europe include only the mid-priced Model 3 and Model Y, both of which are in urgent need of redesign as their global and European sales are declining.

Executives from BYD, Great Wall, and Chery told Reuters they are seeking to deeply cultivate the European market. Chery's Tueting said the company is comprehensively focusing on all aspects of the European automotive ecosystem, from brand building to financing tools, as well as maintenance and used car value, for both private and corporate customers.

"We are fully prepared," Tueting said.

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