According to a study, Chinese automakers are significantly expanding their production in Europe

Image: BYD (illustrative)

According to analysts, production by Chinese automaker brands in Europe is set for significant expansion. Companies such as BYD, Chery, and Leapmotor are building new factories or utilizing existing unused capacity at European manufacturers. This process will begin this year and is expected to reach a high level by 2030 at the latest.

According to Global Mobility’s forecasts, around 90,000 vehicles of Chinese brands will be produced in Europe by 2026, reports Automobilwoche. Production is expected to reach one million cars by 2030, with the figure rising to 1.5 million by 2035. These will mostly be electric vehicles and plug-in hybrids, which are a priority for manufacturers in the People’s Republic.

The background to this development is the EU’s Industrial Accelerator Act (IAA), whose details are currently under discussion. Quotas for industrial value addition and regulations on foreign direct investment are expected. The design of the IAA will influence to what extent manufacturers shift their value creation to Europe. Additionally, there are EU tariffs imposed at the end of 2024 on electric cars built in China, which may soon apply to hybrids as well.

According to the latest analysis, Spain is considered the most important production hub for Chinese manufacturers, followed by Hungary, the United Kingdom, and Austria. By 2030, roughly half of Chinese models are expected to be produced in Spain. This proportion could rise to nearly one million vehicles by 2035, accounting for two-thirds of all European production of Chinese brands.

Projections from IAA’s Global Mobility indicate that by 2030, full manufacturing of Chinese models will dominate over partial assembly of components. By 2035, almost 90 percent of vehicles could be produced locally on site.

While European suppliers hope to gain advantages from Chinese production, Henner Lehne, an expert in global mobility, warns of the risk that China could take over these suppliers. “That would lead to further loss of expertise, as in the case of robot manufacturer Kuka,” says the industry expert.

Also interesting

About the author

Thomas Langenbucher is an expert in electric mobility with experience in the automotive and financial industries. Since 2011, he has been covering electric vehicles, sustainable technologies, and mobility solutions for ecomento.de. Learn more.

Reader interactions