Chinese electric cars could cause billions of dollars in damage to European rivals 3
Automobile manufacturers in Europe are worried about the prospect of suffering huge losses from Chinese electric cars.
According to a report by Allianz Trade, Chinese-made electric vehicles pose a huge risk to European automakers and could cost them 7 billion euros ($7.7 billion) in lost profits each year.
Specifically, according to a newly published report by German insurance company Allianz, policymakers need to face the challenge of tariffs on cars imported from China, strengthening materials development.
More and more Chinese car manufacturers are entering the European market
European automakers face a double threat.
Even though China is a rapidly growing market with an increasingly intense `price war`, most global automakers have pledged to return here with many new electric car models.
The pure electric vehicle market in China is very crowded, especially in the SUV segment, which puts pressure on automakers in the country of billions of people to export more vehicles to Europe.
A dealership of Chinese car company Xpeng in Sweden
Allianz Trade said Chinese electric car imports could cost the European Union more than 24 billion euros in lost economic output by 2030, equivalent to 0.15% of the bloc’s gross domestic product.
Not only that, the `auto-dependent economies` of Germany, Slovakia and the Czech Republic could face an even bigger impact, expected to be between 0.3% and 0.4%.
Europe is the world’s export powerhouse in auto manufacturing, generating a trade surplus of between 70 billion and 110 billion euros per year for its economy over the past decade.
The report also highlights that the US Inflation Reduction Act (IRA) has contributed to making Europe a target for Chinese exports.
“While Europe remains relatively open to imported electric vehicles – Tesla, for example, accounts for 20% of all-electric car sales in the market – the US is considered a more difficult market
Passed by the US Congress in August, the IRA is designed to accelerate the transition to a low-carbon economy.
In recent times, China continued to consolidate its dominant position in the field of electric vehicles.
In the first quarter of this year, China’s total auto exports increased 83% year-on-year.
