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China Moves Car Production To Europe To Avoid Import Duties
Chinese electric car manufacturers are rapidly expanding their production facilities in Europe to avoid high import duties from Brussels. Chinese cars are expected to roll off the production lines in Spain, Poland, Belgium, Italy, and Hungary.
The European Union imposed import duties on Chinese electric vehicles earlier this month, potentially as high as 48 percent. Chinese manufacturers are therefore looking for European partners. In Barcelona, the Chinese Chery is working with the Spanish Ebro. Chery hopes to start production there at the end of this year and is still looking for a second European location.
Leapmotors
In Poland, T03 cars from Chinese manufacturer Leapmotor are assembled in a factory owned by Jeep and Fiat producer Stellantis. BYD has announced plans to build its own factories in Hungary and Turkey. And Volvo Car, the Swedish automaker owned by China’s Geely, wants to build its new EX30 model in Ghent.
Europe is a lucrative market for electric cars for Chinese manufacturers, although they have captured less than 10 percent of the market share so far. European countries are eager to welcome the manufacturers. Italian Industry Minister Adolfo Urso recently travelled to China for talks with manufacturers Anhui Jianghuai and Dongfeng.Tavares
Still, Stellantis CEO Carlos Tavares, despite his company’s partnership with Leapmotor, is not entirely reassured by the arrival of Chinese companies. “We have to be ready for the fight,” he said Thursday.
Jobs in Europe? That remains the question
How many jobs the Chinese collaboration will create is also questionable. Many of the Chinese cars are largely assembled in China. In June, the Italian competition authority fined DR Automobiles €6 million for wrongly labelling cars from Chinese manufacturers, including Chery, as Italian-made. DR said it planned to appeal and that the vehicles were only 60 to 70 percent assembled in China.
The European Union’s import duties are intended to put an end to unfair competition because China subsidizes its own manufacturers. The duties are still provisional. Brussels and Beijing are still in talks about reducing Chinese government subsidies.
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