Expert: Chinese car companies could build plants in Europe -November 06, 2023 at 11:46 pm EST

CHEMNITZ (dpa-AFX) – According to car expert Werner Olle, Chinese car manufacturers such as BYD and SAIC will soon follow Tesla’s example and build plants in Europe. The researcher from the Chemnitz Automotive Institute told the German Press Agency that Germany has a very good chance of being chosen as the location for a new car factory. It is true that energy costs in Germany are high. “But the most important criterion is the high level of automotive expertise.” This includes the close network of suppliers and the potential of skilled workers. Chinese cars “made in Germany” are a quality issue for manufacturers and an important image factor.

According to Olle, China’s car exports have been increasing significantly since 2021. Europe is increasingly coming into focus as a target market. “From 2025, China will become a net exporter, while Europe will become a net importer.” This is because China has competitive advantages in the increasingly important field of e-cars. According to Olle, this includes not only the size of the Chinese market, which enables corresponding cost advantages, but also the availability of important parts – from raw materials to batteries and semiconductors.

Mass market as an opportunity

Now that Chinese manufacturers have dominated their own market for e-cars, entering foreign markets is the next logical step, explained Olle. They are still at the beginning here. However, strong growth is expected in the coming years. For example, manufacturers are working intensively on setting up sales and service locations in Germany. In addition, they are occupying the high-volume market segments for electric cars that European manufacturers have neglected to date. “This is a huge opportunity for Chinese manufacturers.”

The next step is to set up their own production facilities abroad, explained Olle. “This step will follow in the next two to three years in order to secure and expand this market position as sales figures continue to rise in foreign markets.” Several manufacturers have concrete plans. He mentioned SAIC, BYD and Great Wall Motors. At BYD, a decision for a new plant in Europe could be made by the end of the year, said Olle.

The manufacturer Nio also announced at the IAA motor show in September that it would go one step further. If sales reach the 100,000 vehicle mark, a factory in Europe could be profitable, explained European head Hui Zhang./hum/DP/zb