Are Chinese cars heavily discounted at the end of the year?

This large clearance sale, once mentioned or even dreamed of during consultations on the ecological bonus reform, is no longer a fantasy.

The new eligibility criteria for the generous French Ecological Bonus are going to heat up the calculators at most non-European car manufacturers. The methodology chosen to determine which vehicles will be eligible for government aid is quite simple and based on an environmental score given by ADEME, the Agency for Ecological Transition. According to the organization, electric cars must achieve a minimum score to remain eligible for the ecological bonus. The scoring considers four main criteria: the materials used to produce the vehicle, the energy consumption related to the assembly of the vehicle, the type of battery on board, and finally the mode of vehicle transportation. While the first three points are almost the same for all major manufacturers, it is the last one that will likely give cold sweats to Chinese sales teams. Of course, when crossing half the globe, you pollute, and that’s not good.

Cars manufactured in China, as well as models produced outside European borders such as the Dacia Spring, will therefore be excluded from the scope of the ecological bonus.

What to do to circumvent the measure?

Actually, not much, except producing in Europe. Having a presence in Europe mainly offers the double advantage of avoiding import costs and transport costs. While the European Union is considering retaliatory measures against generous Chinese subsidies, which isn’t stupid, because aside from increasing taxes, there’s not much Europe could do. MG, in particular, has already made significant progress on this front and is in the stage of negotiating installation aid with the latest candidates. A factory equals jobs, which is valuable for public authorities.

Chinese reaction under pressure

We know the legendary responsiveness of Chinese industry, but launching European production before the end of the year is really too tight! Early 2025 is a reasonable goal, but until then, there are plenty of cars to sell quickly because the deadline is October 10!

Manufacturers will still have a grace period to sell off the production already in France with the Bonus they were eligible for crossing the border. But it’s very unclear! Some announce the cutoff date as December 15 and the publication of the list of cars eligible for the new Green Bonus. Others talk about three months. The most cautious, as we admit, do not know.

It will therefore be urgent to clear out this fleet, and it is highly likely that on October 10 promotions will drop like in Gravelotte. Afterwards, manufacturers will have to adjust their prices to this sharp additional cost of €5,000 or €7,000 for consumers, while waiting to produce locally. Their message is well-honed, as demonstrated at the Lyon Motor Show. They are ready and have enough margins to align their prices with those eligible for the Bonus.