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Sales of Chinese electric vehicles in Europe are coming to a “screwing halt” amid growing threats of a trade war between Beijing and Brussels, experts say.
According to an analysis by consulting firm Schmidt Automotive, just 116,100 new Chinese-branded cars will be registered across Western Europe in the first four months of 2024, accounting for just 2.9% of the new-car market.
This represents a slight decrease from its 3% share in the same period last year.
While it sells a lot of hybrids domestically, brands such as MG and BYD, both subsidiaries of SAIC, are focusing on selling electric cars, mainly in the UK and Europe.
This figure applies to all pre-2004 European Union countries, plus the UK, Iceland, Norway, Switzerland and Liechtenstein.
Matthias Schmidt, founder of Schmidt Automotive, said Chinese manufacturers appeared to be struggling because they could not secure enough specialized ships to transport their cars.
But a giant car carrier operated by BYD that had previously been sent to Europe was recently sent to Brazil, suggesting the looming threat of higher import tariffs in Europe may also be alarming China.
Brussels is investigating claims that China’s electric vehicle (EV) industry benefits from huge government subsidies, and the European Commission is due to announce next week whether it will impose trade tariffs.
In response, Beijing accused the EU of “protectionism” and threatened to retaliate.
“Sales of Chinese-branded cars in Western Europe are clearly starting to slow,” Schmidt said.
“One of the reasons for this is that there are simply not enough roll-on, roll-off transport vessels to deliver these vehicles.
“But these ships are now being sent elsewhere too, suggesting either the European rollout of Chinese cars is not going according to plan or that they are worried about facing protectionism on the continent.”
“The European Union has warned that any tariffs imposed could be applied retroactively, so it may not make much sense to rush large numbers of cars onto the market at this point.”
According to Schmidt’s analysis, the majority of the Chinese brand’s models are made by MG, which launched the electric MG4 in Britain last year.
The company accounts for 61% of models shipped from China, with shipments up 23% in the first four months of the year.
But MG’s sales rose just 0.5 percent in April, suggesting a significant slowdown that coincided with the end of France’s tough subsidy regime, he added.
Meanwhile, BYD registered just 9,970 new electric vehicles from January to April.
Earlier, another auto consultancy, Jato Dynamics, also warned of a slowdown in Chinese car sales in Europe. Felipe Munoz, an auto expert at the firm, said another factor weighing on Chinese car sales was the “perception of lower quality” among European consumers.
“It was always expected that China’s penetration into the European auto market would take longer than people initially anticipated,” he said.
“Chinese brands are suffering from the overall slowdown in the EV market, but it will take time for them to change consumer perceptions.
“These are very good products with huge improvements in terms of quality, but it’s not easy to change minds – just ask the Japanese or Koreans, who took years to get to where they are today in Europe.”
“I think it says a lot that MG is the best-selling EV brand in Europe and that many people still perceive it as a British brand.”
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