Why Chinese manufacturers could have difficulty establishing themselves in Europe?

Building a manufacturer’s brand image can take years, even decades. Before being recognized as a premium manufacturer in its own right in Europe, Audi was in the shadow of BMW and Mercedes for several years. It was in the 90s and early 2000s that the manufacturer really started to be considered a premium brand.

It’s a bit the same scenario for DS, which will soon celebrate its tenth anniversary, and which is not yet officially recognized in the eyes of customers as a truly high-end manufacturer, despite considerable marketing efforts.

Twice as much work for Chinese brands?

For Chinese manufacturers, the step should be even higher. Between the skepticism of European customers with “Made in China”, import costs and other obstacles of all kinds, Chinese brands still have a long way to go. The experts consulted by the press agency Reuters are convinced of this, even if, they point out, “the beginnings are promising”.

According to consulting firm Inovev, around 8% of electric vehicles sold in Europe in 2023 were Chinese, compared to 6% in 2022 and 4% in 2021. At least eleven new fully electric Chinese models will be launched on the Old Continent by 2025, according to a study by Allianz. But the numbers don’t tell the whole story, as there are bound to be obstacles.

First of all, it will be necessary to succeed in convincing the motorists most loyal to traditional European brands. Surveys show that most potential electric car buyers are unaware of Chinese brands. The most informed even prefer to stick to the “100% European”.

Life could also be difficult for those who are successful. Chen Shihua, deputy general manager of the Chinese Manufacturers Association, has some doubts: “It is not easy for our car manufacturers to internationalize. We will have to be aware of the risks that this may also entail. At present, manufacturers can be quickly overwhelmed if they do not have a clear strategy for each market they covet”.

Chinese electric cars won’t be so cheap in Europe

The trump card may be the price of Chinese cars. As Jato Dynamics revealed, the average price of a Chinese electric car in Europe averages 32,000 euroswhich is much less than the 56,000 euros on average for European brands.

However, Chinese manufacturers face several problems, including those related to logistics, customs duties and other taxes, that won’t make Chinese vehicles as cheap as you think. In any case, not as much as in China.

The real race between Europe and China will therefore be based on prices and customer services, which could make certain models much more attractive than others. It is still necessary that European customers are seduced by the idea of ​​buying cars from manufacturers that they do not necessarily know.

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