Chinese automotive supply chain companies are rapidly establishing production bases in Europe. Dongfeng Motor Corporation has revealed that it is in talks with the Italian government about investing in a manufacturing facility in Italy, with potential participation from the Italian government and local parts suppliers. Companies such as BYD, SAIC Motor, CATL, Liyuan Heng, and Enjie Co., Ltd. are also actively advancing their European expansion plans. Industry experts suggest that with the scale of production capacity expansion, the Chinese automotive supply chain is likely to achieve a win-win situation in Europe and explore larger market opportunities.
Recent reports indicate that discussions between Dongfeng Motor and the Italian government have entered a substantive phase, although specific details are still being finalized. The focus on Dongfeng's expansion into Italy is driven by the growing popularity of Chinese new energy vehicles in the European market. For instance, Ankai Bus's electric double-decker sightseeing bus, featuring a "China Red" design, will offer an eco-friendly sightseeing experience during the 2024 Paris Olympics, becoming a top choice for tourists.
In the passenger vehicle sector, BYD has introduced multiple new energy vehicles across 20 European countries and opened over 260 stores. Earlier this year, BYD partnered with German distributor Sternauto to open its first store in Berlin. SAIC Motor's MG 4EV electric vehicle has won car of the year awards in the UK, France, and Germany.
According to the China Association of Automobile Manufacturers, from January to July 2024, Chinese automobile exports reached 3.262 million units, an increase of 28.8% year-on-year. The top three markets for Chinese new energy vehicle exports are Brazil, Belgium, and the UK. SAIC Motor forecasts that its MG electric vehicle sales in Europe will reach 250,000 units in 2024, making local production in Europe a feasible option. SAIC Motor Chairman Wang Xiaoqiu has stated that plans for establishing a factory in Europe are progressing rapidly.
Chery Automobile is making the fastest moves in the export sector. On April 19, 2024, Chery signed an agreement with Spain's Ebro-EV Motors in Barcelona to establish a joint venture for producing new electric vehicles. According to the agreement, Chery will launch new models in the third and fourth quarters of 2024, with annual production expected to reach 50,000 units by 2027 and 150,000 units by 2029.
BYD's ATTO 3, Dolphin, and Seal models have made their debut in Hungary, marking Hungary as the first Central and Eastern European market for BYD. On January 30, 2024, BYD signed a land purchase agreement with the government of Szeged, Hungary, to build its first passenger vehicle factory in Europe. The new plant, set to commence production in 2025, will create thousands of local jobs.
In the power battery sector, CATL's new factory in Debrecen, Hungary, has completed construction, with a design capacity of 100 GWh, making it Europe's largest power battery plant. The first phase, with a capacity of 40 GWh, is scheduled to commence in 2025. EVE Energy has also announced plans to invest in a new plant in Debrecen to produce cylindrical batteries and supply lithium-ion cells for BMW's "New Generation" models.
CATL's expansion has prompted its upstream partners to also explore international opportunities. On August 15, Liyuan Heng announced that its PACK production lines for clients have passed inspection and its European-standard high-precision liquid injection machines have been shipped to France. Liyuan Heng's plant in Poland is now capable of serving the European market, with industry-leading equipment. Enjie Co., Ltd. has invested in a wet-process lithium battery separator production line in Debrecen, Hungary. The first phase of the line became operational in December 2023, and a second phase, with a total capacity of 800 million square meters per year, is planned for 2024, with a total investment of approximately 447 million euros.
The rapid expansion of Chinese automotive supply chain companies is expected to drive green transformation and economic development in the European market.
