ROME – The Chinese car slows down at home but invades the rest of the world. And not with electric ones.
In April, in fact, the Dragon’s car exports jumped by 38%, to 417,000 units, while, according to data from the China Passenger Car Association, domestic sales fell by 5.8% annually to 1.55 million units , due to the fierce price competition between producers and the uncertainties linked to the performance of the Beijing economy which has pushed many consumers to be more cautious in their purchases.
The data, however, are not so dramatic for the European car industry, because the growth in exports of four-wheelers made in China has marginally affected the Old Continent. And this is a fact mainly due to the position taken by the European Union which, fearing duties following the investigation into the Beijing government’s subsidies to national producers, pushed the manufacturers of the Dragon to focus on new markets, such as South America, Australia and Asean. A sign that an increase in tariffs on Beijing’s cars, as the Biden Administration is about to do in the US and as the EU could soon do, can slow down the feared invasion of the Dragon’s four wheels.
Chinese manufacturers, moreover, as underlined by Cui Dongshu, general secretary of the China Passenger Car Association, are almost “forced” to sell abroad because the domestic market is experiencing a phase of decline, above all due to the price war unleashed by Tesla and relaunched by other manufacturers, including a giant like Byd. And in fact the decline in car sales in China on a monthly basis in April was as much as 9.6% compared to March.
In particular, while the share of sales of new energy vehicles (NEVs) has reached a new high, those of electric cars are much slower than plug-in hybrid (PHEV) models. NEVs were 43.5% of total sales in April, in line with the government’s target of 45% by 2027. Sales of electric vehicles, however, fell by 6.3% month on month compared to March and those of hybrid vehicles by 4.7%. A small warning sign, even if the Phev segment grew at the fastest pace since 2022, and brought China’s share of the global hybrid-electric vehicle market to nearly 70% in the first quarter.
The weakening of sales of electric vehicles has revived incentives and a price war between manufacturers: to try to stimulate demand, China has announced subsidies of up to 10,000 yuan (around 1,400 dollars) for trade-ins, while some manufacturers, including Tesla and BYD have started offering the most requested models without making advance payments.