China’s supremacy in the electric car sector will soon lead it to reach, in addition to the global record for production and sales that it has already held for 14 years, also the goal of the world‘s leading exporter of motor vehicles, supplanting European and Asian producers. And the Trojan horse of this invasion will be the Old Continent, both because more and more European cars leave Chinese factories to be sold abroad, and because of the growth of ‘made in China’ cars, especially electric ones , who land in Europe.
Chinese ready to invade. Here are brands and models that we will soon see in Europe
by Graziella Marino
The alarm was sounded by the Institute for International Political Studies (ISPI), which highlights how China’s transformation from market to competitor in the automotive sector risks having a significant impact on an industry worth 8 .5% of manufacturing employment in Europe and which represents by far the first among the few surplus items in EU-China trade. Hence the urgency to change the approach. The first to understand this were the United States which, with their Inflation Reduction Act (IRA), which came into force in January, grants substantial tax breaks to those who buy cars ‘made in the USA’, especially if they are electric.
The Chinese at the Paris Motor Show, BYD’s debut with a European-style show
by Paolo Griseri
In recent days, the countermove of the EU Commission has also arrived, with its proposal for a ‘Green Deal Industrial Plan’ which aims to support the competitiveness of European industry with zero emissions. However, the discussion immediately stalled on the method of financing the aid. In short, the process is still long, but times are short. In fact, China is already on its way to becoming the second world exporter of motor vehicles behind Japan and could reach the record in 2030, with 5.5 million cars exported, 2.5 million of which are electric. In the last year – explains ISPE – there has been a real leap in the export of cars from China: +56.7% compared to 2021. And of the 2.53 million units shipped abroad, 651,000 are new energy vehicles (battery electric, plug-in hybrid and hydrogen fuel cell), the so-called NEV. Car exports from China are now only a hair’s breadth (about 80,000 units) behind those of Germany, but have already distanced South Korea and the US.
The great challenge of electric batteries, who will win between China and the West?
by Graziella Marino
The pivotal year was 2018, when domestic sales fell for the first time in as many as three decades. A sign of potential internal overproduction that has prompted the home giants to project themselves abroad. Thus exports of cars, which increased by 2.7 times between 2010 and 2020 (from 283,000 to 760,000), have jumped by 3.3 times in the last three years alone. And the supply chain has also kept pace with production. Chinese companies now produce nearly all the parts, even the high-strength steel and glass-reinforced fiberglass, which they imported until about a decade ago.
A luxury called automobile
by Valerio Berruti
The case of BYD is emblematic in this sense. Apart from windshields and tyres, the Chinese electric car giant independently produces almost everything in the car, including batteries and semiconductors. Even some of the key materials come from its own mines. Thanks to this integration, for example, BYD’s product development costs are 20-30% lower than those of the world‘s leading manufacturer, Toyota, which prides itself on logistics efficiency. Yet, despite cost cutting, Chinese cars now easily pass European safety tests, thanks to the growing automation and standardization of processes. And if at the moment the main markets for Chinese cars are the Middle East and Latin America while the EU represents about 15% of sales, there is no need to rest assured. As demonstrated by the numerous launches of ‘made in China’ cars scheduled for this year in Europe, including Italy.
In the intentions of some Chinese manufacturers there is also the landing in the USA and the opening of factories directly in Europe. But if on the first point the launch of the Inflation Reduction Act (IRA) has blocked them, at least for now, on the second point they currently see no obstacles. And in fact BYD is already working to open its own factory in Europe. Unless Brussels moves.