With Tesla’s permission, the major upheaval in the transition to electric cars is now being led by Chinese brands, both in Spain and in the rest of Europe. The forecast is that this year they will account for a quarter of all passenger cars of this type registered in the EU while they even explore the possibility of opening a factory on the continent, as Chery has just done in Barcelona. The landing is already underway and has a double meaning: on the one hand, it threatens the hegemony of European manufacturers and, on the other, it encourages the market with lower prices.
Of the Chinese brands that have already arrived in Spain, MG stands out, which has managed to place one of its low-cost combustion models, the ZS, as the best seller. It also has another on the electric podium, behind the Tesla Y and 3. It is accompanied by other brands such as BYD, SAIC and, more recently, BAIC, which this month began using the port of Ferrol to distribute its cars throughout All Europe. They also sell gasoline cars, but the slogan is reduced to two words: electric and cheap.
The strong point of these vehicles is the price, lower than that of European manufacturers, whose strategy after the end of the pandemic and when the chip shortage occurred consisted of concentrating efforts on high-end models, which are the ones that offer the best margins. They have neglected the most popular segment of the market, but in exchange they obtain record profits, as indicated by the consulting firm EY.
The Omoda brand, belonging to Chery, and MG offer electric cars in Spain with prices close to 20,000 euros, once discounts and aid are applied. It is the closest that has come to date to combustion vehicles and breathes some hope into a still immature market. If you add the savings in fuel – more expensive than electricity –, the accounts can begin to add up. Another thing is that the consumer needs time and some prior opinion before buying a Chinese electric car.
The International Energy Agency (IEA) has some messages on this matter. On the one hand, it predicts that the price of electric cars and conventional passenger cars will still take seven years to equalize. On the other hand, it recognizes China’s role in achieving convergence. According to their calculations, China exported 1.2 million cars last year, 80% more than the previous year, which has allowed it to enter European markets with force.
The emergence of China has been accompanied by complaints from local manufacturers and political preventions. In a recent letter to Europeans on the occasion of the June elections, the CEO of Renault, Luca de Meo, recognizes that China is ahead in electrical technology and assures that the European industry is “threatened.” He incidentally criticizes Brussels for dedicating itself to regulation, instead of promoting strategic autonomy.
Chinese brands will begin to be seen in a different light as soon as they begin to produce in Spain, as has happened with so many foreign groups. With its commitment to Barcelona, ??Chery not only covers itself against the tariffs that a more protectionist Europe may impose, but also opens the way. To date, only one Chinese manufacturer, BYD, had announced the opening of a factory in the EU, in Hungary. Accompanied by Ebro-EV Motors, Chery plans to assemble 150,000 vehicles in 2029 at the former Nissan facilities in the Free Zone.
Another Chinese company, Envision, has already received aid for its lithium battery factory project in Extremadura, in which, it says, it will invest 2.5 billion euros and will employ around 3,000 people.