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Selling factories to Chinese partners: risky road for European carmakers
This is a question all European carmakers are facing. The continent's car market has never fully recovered from the Covid pandemic downturn and their factories are operating on average at only half capacity.They also face an onslaught from Chinese carmakers, whose rapidly advancing technical prowess and low production costs pose major risks to global rivals.And as weak demand makes the domestic Chinese market fiercely competitive, Chinese automakers are increasingly looking to Europe as an El Dorado.Brands such as BYD, MG, Chery, Geely, Leapmotor, Jaecoo, and Xpeng, were virtually unknown three years ago in Europe.Now they already account for nine percent of European sales overall and 14 percent of electric vehicle sales, according to the consulting firm Dataforce.Tariffs and consumer incentives for which only European-assembled cars are eligible have posed a hurdle for Chinese automakers to gain market share in Europe.So, they are increasingly looking to hop over these obstacles by manufacturing in Europe, either by building factories or, even more simply, by buying them.Chery kicked off the trend in 2023 by buying a former Nissan plant in Barcelona, Spain, where it now plans to produce 200,000 vehicles a year.It said last month it would open a research and design centre in Paris to work on developing a small electric car to manufacture in Europe for the local market. Nissan is reportedly considering selling its British plant in Sunderland -- its last in Europe -- to Chery or the Chinese company Dongfeng.Closer collaborationThis Friday, the Franco-Italian-American manufacturer Stellantis -- whose brands include Peugeot, Fiat and Jeep -- became the first European automaker to take the plunge.It announced it was considering partially selling its Villaverde site in Madrid to Leapmotor, in which it holds a 51-percent stake.It already plans to open its Zaragoza plant so that Leapmotor can soon produce a model there under its own brand. An electric SUV sold under the Opel brand could also be produced in Zaragoza in collaboration with Leapmotor.And this is only the beginning: this German-Chinese car will serve as a template for other Stellantis vehicles.Some European cars already incorporate a large number of Chinese components, such as Renault's electric Twingo, which was also designed at a Renault facility in China. The Stellantis announcement, however, is the first time a European automaker has so openly presented such collaboration on producing models with a...
Selling factories to Chinese partners: risky road for European carmakers
Carmaker Stellantis announced Friday it is considering selling an underutilised factory in Spain to its Chinese joint venture Leapmotor, which could save jobs in the short term but risks further strengthening Chinese automakers.The Stellantis announcement, however, is the first time a European automaker has so openly presented such collaboration on producing models with a Chinese partner.
Chinese automakers shift strategy to target European drivers
After the first wave of winning over customers with more affordable models and rich equipment, they are now changing tactics: They are developing cars specifically tailored to European drivers, their habits and tastes. Chinese car manufacturers are increasingly aggressively changing their approach to entering foreign markets, especially in Europe.
Chinese EV maker Leapmotor taps Stellantis' Spanish plant for EU ...
Hangzhou carmaker's overseas strategy highlights how Chinese brands are leveraging idle plants to scale globally while easing trade barriers.
