Despite the Western auto industry working closely with Chinese companies, there is still a growing fear that the European market will be ‘flooded’ with cars from the Middle Kingdom. And according to a recent study, that is more than justified.
Chinese car brands will capture a third of the global market and sell nine million vehicles outside China by 2030, according to management consultancy Alix Partners. In Europe, this will come at the expense of European, Japanese and Korean brands, industry experts wrote in a study published on Tuesday.
The production costs for an electric car are a third lower in China than in Europe. Development cycles are shorter than those of global competitors. Chinese carmakers expanded their market share with “aggressive pricing”.
“New EU tariffs on Chinese cars could slow imports and support sales prices in the short term, but they will also accelerate local production of Chinese vehicles and parts in Europe,” says industry expert Fabian Piontek. German manufacturers also felt the competition from Chinese manufacturers in China: “This particularly affects German premium manufacturers, for whom an important market in China is increasingly eroding.”
Under political pressure, many manufacturers have switched to electric cars in recent years, but demand is slowing. According to Alix, the market share of new electric vehicles in Europe is expected to increase from 20 percent this year to 45 percent in 2030.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
