Dossier: The Offensive of Chinese Cars

Some manufacturers like MG Motor have been present for two years, while others like BYD will arrive in a few months. Chinese automobile brands are no longer a mirage, but a reality with predominantly electric models aiming to overthrow the traditional leaders. A danger for the industry, but a boon for consumers?

We are talking about a time that people under twenty do not know (famous refrain). Contrary to appearances, Chinese car manufacturers have been eyeing France and Europe not just for a few months, but for over fifteen years. This is how a distribution agreement was signed between the Chinese brand Landwind and the French company Asie Auto in early 2006 to import the S model. This compact SUV, closely derived from an Opel Frontera (itself based on an Isuzu Rodeo), was ultimately never sold in France despite Asie Auto’s ambitions, which planned to open up to one hundred and thirty branches nationwide by 2008!

The second attempt was made by BYD (Build Your Dreams) which tried  to import its electric minivan e6 (2011) and hybrid sedan F3DM (2014), but with little success beyond some publicity in Benelux, particularly targeting taxi artisans.

It was not until 2019 that a serious candidate entered the market. Well-known across Europe, MG Motors, the iconic British brand acquired by the Chinese SAIC in 2005, now pulls out all the stops. In the first eight months of the year, over 1,905 MG electric vehicles and 1,975 MG plug-in hybrids were sold (source: AAA-Data). This served as a trigger for other players, since Lynk & Co (1,782 plug-in hybrids), Aiways, and Seres quickly capitalized on the opportunity with some success. A good result facilitated by the rapid development of the distribution network, with MG Motors France now having 120 dealerships, while Lynk & Co offers leasing without a down payment or contract length at 550 euros/month… exclusively online.

Serious Chinese Products

This is the first wave. What might the second look like? Let’s stay with MG and its new generation of electric cars, including a model that will make headlines: the MG4 (see following pages). It could potentially harm the best-seller Renault Megane E-Tech, currently the number one in electric vehicles thanks to its attractive price. This could open Pandora’s box and lead new players to the Paris Motor Show (October 17-23, 2022), such as BYD, Great Wall, Nio, or Xpeng. Not to mention the millionaire startup Leapmotor, whose city car T03 is expected to significantly challenge the Dacia Spring and other Renault Twingo E-Tech models.

These players should therefore be taken very seriously for three other reasons. The first concerns the very good crash-test results of Chinese brands. For example, the Ora Funky Cat and Wey Coffee 01 (properties of Great Wall) achieved a brilliant 5-star rating at EuroNCAP, even surpassing the BMW i4 and Renault Megane E-Tech electric.

The Low Price, a Serious Argument for Chinese Cars

Similarly, the geopolitical upheavals caused by the war in Ukraine and the consequences of the Covid-19 crisis have significantly increased the prices of new cars and fuels. Thanks to their attractive prices, also benefiting from unbeatable labor costs (the average salary in China was €876 per month in 2020), Chinese manufacturers are now among the most price-competitive, with models sold at several thousand euros less than market references. For plug-in hybrids, the Lynk & Co 01 SUV is priced at €42,000 (including reservation fees), compared to €54,150 for its technical sibling, the Volvo XC40 Recharge “Plus,” with comparable equipment.

Finally, and this is the strongest argument, the scheduled end of thermal car sales in Europe by 2035 will dramatically boost electric vehicle sales. And who is the world leader in electric battery manufacturing? A Chinese company! CATL leads the way, alongside BYD, which ranks 3rd globally, together accounting for nearly half of the market in the first half of 2022 (Source: SNE Research).

“When China wakes up… the world will tremble,” predicted Alain Peyrefitte in a 1973 essay. He was right, and it is happening now.

Also read: In Europe, 20% of electric cars come from China