Chinese automakers make significant inroads in the European market, with sales rising 78% in the first quarter of 2025. Analysts suggest this growth stems from a strategic pivot in response to potential EU tariffs on Chinese electric vehicles.
According to market research firm Dataforce, Chinese brands sold 148,096 vehicles in Europe during Q1 2025, increasing their market share from 2.5% to 4.5% year-over-year. This growth contrasts with the overall European auto market, which saw a slight 0.2% decline.
A notable point is that Chinese brands saw slower growth in the electric vehicle (EV) sector. During the same period, the sales growth of Chinese EVs increased by only 29%, aligning with the overall EV market growth rate. Chinese brands’ EV market share remained stable at 7.9%.
The figures show that Chinese manufacturers are shifting their strategy in Europe towards internal combustion engine (ICE) and hybrid vehicles. BYD is expanding its plug-in hybrid lineup for European and African markets, while SAIC’s MG brand focuses on gasoline and hybrid versions of its best-selling ZS small SUV. EVs now make up just 13% of MG’s total European sales.
The strategic shift of Chinese brands in Europe reflects more than just short-term sales growth. It is a clear response to the EU’s investigations into subsidies and price dumping of Chinese EVs. Chinese manufacturers are expanding into ICE and hybrid models to secure profitability and market share, preparing for potential challenges to EV price competitiveness.
This strategy creates a contradiction in brand identity. BYD and MG, once aiming to be EV innovators, are increasing their ICE model offerings, potentially weakening their image as leaders in electric vehicle technology. With tightening environmental regulations in Europe, it is uncertain whether this will be a sustainable long-term strategy. The success of Chinese cars in Europe will depend on balancing EV regulations with brand positioning.
