Chinese electric cars are not popular in Europe

Chinese electric vehicle (EV) makers have overtaken foreign rivals to take the top spot in sales at home and are now looking to expand into Europe.

According to automotive consultancy Inovev, 8% of new electric cars sold in Europe this year were made by Chinese brands, up from 6% last year and 4% in 2021.

This number is expected to continue to increase in the coming time. According to a study by the international financial services Allianz (Germany), there will be at least 11 new electric car models made in China launched in Europe by 2025.

The arduous price war

The growing presence of Chinese EV brands has Western automakers worried. In July, Carlos Tavares, CEO of Stellantis (owner of famous luxury brands such as Peugeot and Fiat), warned of an “attack” of cheap Chinese electric cars on Europe.

However, car manufacturers in this continent have also launched a series of their own EV models, while cutting production costs as well as prices to compete with "players" from Asian countries.

French carmaker Renault says it is planning to cut the cost of producing electric cars by up to 40%. Renault CEO Luca de Meo said the group's production costs will start to fall significantly from the second half of this year thanks to lower raw material costs.

Renault CEO Luca de Meo next to the concept version of the Renault 4Ever Trophy, a small EV that Renault plans to launch in 2025. Photo: Autonews

The efforts of European countries have posed a challenge to Chinese EV makers, as they see price as their “trump card”.

According to researchers at Jato Dynamics, the average price of an electric car in China will be under 32,000 euros (830 million VND) in the first half of 2022, less than half the price of around 56,000 euros (1.45 billion VND) in Europe.

However, when it comes to Europe, Chinese brands will find it difficult to sell EVs as cheaply as they do at home.

Chinese carmakers will have to spend more on logistics, paying sales tax, import duties and applying for European certification, said Spiros Fotinos, CEO of Chinese EV brand Zeekr in Europe.

MG - Europe's best-selling Chinese brand - said its biggest challenge is getting cars from China to distribution locations in Europe because they have to go through many seaports with long delivery times.

Different needs of European customers, such as larger battery capacities for long trips, could also add to costs, said Alexander Klose, overseas director of Chinese electric car startup Aiways.

Efforts to win consumer trust

While brands like MG have become familiar in Europe, other names like Xpeng or Nio are still struggling to find a foothold in this market.

Surveys show that most potential EV buyers in Europe don’t recognize Chinese brands. If they do, they’re reluctant to buy from the country, which is understandable given that it took decades for Japanese and Korean automakers to gain the trust and taste of European customers.

According to a 2022 YouGov survey, only 14% of 1,629 German consumers were aware of BYD, the world's second-largest electric vehicle maker after Tesla; 17% had heard of luxury brand Nio; 10% knew of Geely's Lynk & Co; and 8% knew of XPeng.

The survey also found that 95% of consumers were aware of Tesla. When asked if they would consider buying another Tesla, 10% said yes. This compares to just 1% of Chinese brands.

BYD is the world's second-largest electric car maker, behind billionaire Elon Musk's Tesla, but the brand is not well-known to many European customers. Photo: Bangkok Post

Several Chinese automakers have been working to achieve five-star safety ratings under European standards and meet legal requirements to ease concerns among customers in the region.

Zeekr will seek to win consumers' trust through test drives and showrooms where they can directly assess the quality of its electric vehicles, Mr. Fotinos said.

“Once they come into contact with our products, they will realize that our products are of much better quality and specifications than the equivalent European products they are used to,” Mr. Fotinos affirmed.

Chinese state-owned automaker GAC (China's third-largest electric vehicle maker) has opened a design office in Milan, Italy, to gauge consumer tastes before officially launching its vehicles.

“The only way to overcome prejudice is to accept competition,” said Mr. Klose of EV Aiways .

Nguyen Tuyet (According to Reuters, Asia Financial)

Source: https://www.nguoiduatin.vn/xe-dien-trung-quoc-khong-duoc-ua-chuong-o-chau-au-a622414.html