My Blog
Business

Chinese EVs are now seen posing a ‘real threat’ to Europe’s auto industry


A BYD Co. Seal electric sedan during the media day for the Munich Motor Show (IAA) in Munich, Germany, on Monday, Sept. 4, 2023.

Bloomberg | Bloomberg | Getty Images

Chinese electric vehicles pose “a real threat” to the European car industry, according to Christian Kames, managing director at financial advisory firm Lazard. 

Kames spoke from the IAA Mobility Conference in Munich, where the number of Chinese companies has soared since the last event.

Around 40% of the presenters at the conference are from Asia, while the number of Chinese exhibitors in attendance has more than doubled from 29 in 2021 to 75 this year, according to IAA Mobility. There are almost 750 exhibitors in total, from 38 countries.

China is a 'very dynamic environment' for car makers, says Schaeffler CEO

The increase in Chinese companies in attendance shows that these firms “really have the European market … as the next market they want to conquer,” Kames said. 

The comments reflect those of Chinese automakers, who have stressed that Europe is a key part of their global expansion plans.

Warren Buffet-backed carmaker BYD launched its Seal electric sedan for Europe on Monday, while Leapmotor, which is based in Hangzhou, China, said its SUV would be available in Europe next year.

Similarly, Xpeng announced plans to sell its cars in Germany in 2024, after already entering the Norwegian, Swedish, Danish and Dutch markets.

“We recognize Germany is the most important and the highest standard market for all” carmakers, Brian Gu, the president of Xpeng, told CNBC in an interview Monday. 

Swiss bank UBS has gone as far as to downgrade two major European automakers because of the threat posed by China’s broadening EV market.

European companies are ‘ready to engage’

European auto manufacturers are well aware of the competition brought about by Chinese companies, Christian Kames told CNBC.

“[European carmakers] get it now, that the Chinese [automakers] are a real threat. The question is what do they do about it,” Kames said. 

“I don’t think we are still at the stage where they underestimate the Chinese,” he added.

It is 'definitely not easy' to break into the European market, Xpeng president says
China competition is a 'real threat' to European car industry, Lazard MD says

“A lot of those big car companies, they’re on the sidelines watching their market share destroyed,” he said.

“Now most of them realized that they probably will not be able to do it by themselves, they probably will not be able to succeed in China by themselves, that’s why you saw Volkswagen partner with Xpeng and I think you will see more of that where some of the local EV guys will partner with multinationals.”

— CNBC’s Arjun Kharpal, Evelyn Cheng and Elliot Smith contributed to this report.

Related posts

Trump-linked DWAC soars 50% after SEC fraud settlement

newsconquest

Amazon launches metaverse-like sport to coach other people methods to use AWS

newsconquest

Beyoncé’s country songs are boosting streams for Black artists

newsconquest

Leave a Comment