Chinese car brands are getting stronger in Europe

According to the information compiled by the AA correspondent from the report titled "From Traditional Capital to Strategic Investments: Europe's Roadmap to Creating a Competitive Automotive Industry" published by Allianz Trade, the European automotive industry is going through a structural change process due to the increasing competition of Chinese manufacturers, the transition to electric vehicles and technological transformation.

The share of Chinese automobile brands in the EU market has increased from approximately 2 percent to close to 10 percent in recent years, and their sales on the continent have exceeded 1 million units for the first time.

The share of Chinese brands in the fully electric vehicle market in Europe reached 16 percent, and their share in the rechargeable hybrid vehicle market reached 26 percent.

While the European automobile market grew by 5 percent in the January-August period of this year compared to the same period last year, fully electric car sales increased by approximately 45 percent. The share of these cars in new vehicle registrations reached the same level as gasoline cars, with 22 percent.

While the share of fully electric vehicles in new sales reached 30 percent in France and 26 percent in Germany, it remained below 10 percent in Italy and Spain.

According to the report, the share of Chinese brands among the brands participating in the 2026 Paris Motor Show increased from 23 percent in 2024 to 50 percent. The share of European brands decreased from 68 percent to 39 percent.

Chinese manufacturers have strengthened their position in the European market thanks to competitive prices, advanced technologies and strengthened after-sales service networks.

The foreign trade surplus of the EU in the automotive trade with China, which reached approximately 20 billion euros in the past, turned into a deficit.

While the EU's automobile exports to China have declined in the last two years, China's electric and hybrid vehicle exports to the EU doubled in the first half of 2026, reaching 14.2 billion dollars, and hybrid vehicle shipments increased by 206 percent.

Despite the additional customs duties of up to 35 percent imposed by the EU on electric vehicles of Chinese origin, Chinese manufacturers continued their growth in the European market by turning to hybrid models.

The market share of Germany's three major automakers has declined in Europe and China since 2021. The added value created by these manufacturers per vehicle in Europe decreased by 30 percent to 45 percent in the first half of 2026 compared to the 2021-2022 period.

It was predicted that if German manufacturers lose market share by another 3 percentage points in both markets by 2030, they may experience an additional loss of added value of approximately 3 billion euros.

According to the announced investment projects, it is predicted that the share of Chinese manufacturers in battery production capacity in Europe may increase from 15 percent to 37 percent by 2030, and to 45 percent if the projects that have not yet been finalized are implemented.

Europe's deficit in battery trade reached 47 billion euros in 2025 and 57 billion euros in annualized data as of July 2026. It was emphasized that investments in battery technologies, software and semiconductors should be increased in order for the automotive industry to maintain its competitiveness.