Automobile Manufacturers Competing on the Paris Stage: China Meets Europe

At this year's Paris Motor Show, Chinese and European automakers are in direct competition, while the EU plans to impose high import tariffs on electric vehicles produced in China. Amid sluggish demand, European manufacturers are fighting for their position in the market, while their Chinese counterparts strive to establish a foothold in Europe. According to the CEO of the Paris Motor Show, Serge Gachot, a total of nine Chinese brands, including BYD and Leapmotor, will present their latest models. While they accounted for almost half of the brands showcased in 2022, this year they only make up about one-fifth of the exhibitors – a clear signal of the determination of European manufacturers to defend their home turf. Recently, EU member states decided to impose import tariffs of up to 45% on Chinese electric vehicles to counter allegedly unfair subsidies from Beijing, which the Chinese government denies. Despite sharp criticism from China, manufacturers there continue to focus on expanding into Europe. For companies like GAC, the event marks the beginning of their European ambitions. Wei Heigang, General Manager of GAC International, stated that local production is key to avoiding the tariffs. Chinese manufacturers like BYD continue to offer their vehicles at lower prices than European competitors, hoping to boost sales. Newcomers like Dongfeng, Seres, and FAW are also showcasing new models to offset weak domestic markets. Additionally, domestic sales in China have increased due to a government stimulus package in September, while sales figures in Europe are declining. With reduced support for electric vehicle purchases in France and Germany, the pressure on the EV market is increasing. European automakers, including Volkswagen, Mercedes-Benz, and BMW, are also under pressure. While VW is discussing cost-cutting measures, European manufacturers in general are confronted not only with high costs but also with the rapid development timelines of their Chinese competitors. The pressure to take radical measures to remain competitive is growing.