Leading Chinese carmakers have dismissed the idea of challenging Europe’s legacy manufacturers with cheaper electric vehicles.
What Happened: At the Paris motor show, Chinese carmakers, including Xpeng Inc. XPEV and Guangzhou Automobile Group Co. Ltd. GNZUF, emphasized their long-term commitment to the European market. This comes amidst a trade war between Beijing and Brussels and fears of a potential “invasion,” reported the Financial Times on Sunday.
“We’re a 10-year-old company. We’re not going to overthrow anybody who’s developed over 100 years,” said Xpeng co-president Brian Gu, while showcasing an electric saloon with advanced artificial intelligence technology. He added that Xpeng aims to be the provider of “premium electric vehicles” in Europe and does not intend to compete on price.
Chinese state-owned carmaker GAC, which is also making inroads in the region, echoed a similar sentiment, emphasizing the potential economic benefits of its entry into the European markets and its willingness to collaborate with European suppliers.
These statements come amid growing political anxiety in Europe over the potential risks posed to the region’s industry. In early October, EU member states agreed on tariffs of up to 45% on Chinese EVs in an effort to counter their advance. This has led to a series of profit warnings from local manufacturers.
Why It Matters: The European Union’s protectionist stance against Chinese EVs has been a point of contention in the industry. The EU’s decision on tariffs for Chinese EVs could potentially lead to a wider trade war with China, as the 27-member bloc’s protectionist stance could hurt its export-dependent companies, and its EV targets, and threaten critical raw material supplies.
China has also warned the EU about the potential negative impacts on trade, especially with Germany, if the EU imposes tariffs on Chinese EVs. The situation has raised concerns about increased costs for consumers and potential impacts on the automotive market.
Meanwhile, Tesla Inc. TSLA rival BYD Co. Ltd. BYDDF BYDDY has slammed the proposed EU tariffs on Chinese-made EVs, warning that they could increase costs and discourage buyers. This warning comes as European and Chinese automakers compete at the Paris car show, the largest in Europe, during a time of weak demand and rising costs.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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