European automakers face tough competition from Chinese EV subsidies, exploring cost-cutting strategies and partnerships.

From Investing.com: 2024-05-23 21:00:36

Europe’s car giants face a tough battle against Chinese automakers. European trade regulators are investigating Chinese EV subsidies that give Chinese carmakers a 30% cost edge. Stiffer tariffs may not protect European automakers from the competition. Renegotiating partnerships and cutting labor costs are strategies being explored to survive.

European Commission President Ursula von der Leyen pledges a “tailored approach” to new tariffs on Chinese EVs. Industry executives warn that China’s lower cost EVs pose a threat to European automakers. Stellantis CEO Carlos Tavares emphasizes the need for quick adjustment to stay competitive. The surge in Chinese exports is forcing Europe’s automakers to rethink strategies.

Founder of NIO, a Chinese EV manufacturer, plans to expand in Europe despite tariff uncertainty. Labor costs remain a challenge in Europe due to union influence. Stellantis aims to cut costs by 10 billion euros by 2026, potentially through early retirement programs. Competing with Chinese automakers on price is crucial for European firms.

Stellantis launches a small electric Citroen to compete with Chinese automakers at a competitive price. Supplier costs are a key focus for Stellantis to match Chinese prices. Tariffs could impact the cost advantage of Chinese automakers. German automakers fear retaliation from China with tariffs on vehicles made in Europe.



Read more at Investing.com: European automakers need time, not tariffs, to fend off China competition By Reuters