Chinese carmakers grow in Europe despite tariffs

Chinese car companies, like BYD and MG, have doubled their share of Europe’s car market, even with new European Union tariffs on electric vehicles (EVs). These tariffs, meant to slow down Chinese EV sales, haven’t stopped their growth. Instead, these companies found smart ways to keep selling. One key move is focusing on hybrid and gasoline cars, which face lower or no tariffs.

Only about one-third of their sales in Europe are EVs, with the rest being hybrids or traditional cars. This mix helps them avoid the high EV tariffs, which can be as much as 35% for some brands like SAIC (MG’s parent company) or 17% for BYD. They’ve also targeted countries like Italy, where local carmakers aren’t as strong, making it easier to gain customers. Another strategy is setting up factories in Europe.

BYD, for example, is building a plant in Hungary to produce cars locally, skipping import tariffs altogether. These efforts have boosted their market share to 8.9% for EVs and 7.6% for hybrids in Europe, the highest in nearly a year. Despite challenges like strict EU carbon emission rules, Chinese carmakers are adapting fast. Their success shows how they’re outsmarting trade barriers while offering affordable, appealing cars to European buyers. This growth is reshaping Europe’s auto industry, putting pressure on local brands to compete.