China beats Japan in Europe car sales

Chinese automakers outsold Japanese rivals in Europe for the first time over a full quarter, underscoring how quickly brands like BYD Co (比亞迪) and Chery Automobile Co (奇瑞汽車) are gaining ground in the region.

Registrations of Chinese-branded cars roughly doubled from a year earlier in the three months through September to make up 12.7 percent of total sales across the region, led by hybrids, according to market researcher Dataforce. That has put them ahead of Japanese manufacturers, including Toyota Motor Corp, at 11.9 percent.

The advance accelerated at the end of the quarter. Chinese brands’ European share jumped to a record 14.5 percent last month, according to Dataforce, almost three percentage points higher than in August.

People visit the BYD stand at the Paris Motor Show in France on Oct. 13.

Photo: Reuters

While European manufacturers like Volkswagen AG or Renault SA still dominate the region, the speed of China’s surge has been a surprise. Five years ago, Chinese brands accounted for barely 1 percent of European sales. Japanese automakers, by contrast, have spent decades building their position in Europe.

Toyota has sold cars in the region since 1963 and now operates factories across the continent, while Nissan Motor Co has produced vehicles at its Sunderland plant in the UK since 1986. China’s offering is especially successful in the UK, where Chery’s Jaecoo 7 SUV was the country’s best-selling model in March and last month.

Earlier this month, Chery, BYD and Geely Holding Group Co’s (吉利控股集團) Zeekr Intelligent Technology Co (極氪智能) showed off a range of new models at the Paris car show, offering well-priced cars like the BYD Dolphin G DM-i, a compact plug-in hybrid specifically developed for Europe. Bringing their electric vehicle lineups to Europe also positions them to benefit from a jump in demand as fuel prices hit record highs.

The EU is trying to temper an expansion that is partly fueled by state-backed subsidies. After adding extra tariffs on China-made battery-electric vehicles, the bloc this month agreed in principle to curb fast-growing imports of hybrid cars from China.

The EU is also considering new rules that would favor locally made cars when granting subsidies and other incentives.

Chinese manufacturers have been preparing to produce locally already. Chery is preparing production in Barcelona and BYD is nearing the completion of a manufacturing site in Hungary. Zhejiang Leapmotor Technology Co (零跑科技) has started making its B10 SUV at Stellantis NV’s plant in Zaragoza, Spain, as part of the companies’ joint venture.