GAC Motor, a major OEM from China, plans to bring its brand to Europe. Its product showing in Paris included a mid-sized SUV (AION V), as well as a luxury hyper car, from its sub-brand HYPTEC HT. Source: IDTechEx (Analyst photograph)
China’s carmakers made a big statement at the Paris Motor Show in France, despite this year’s announcement of heftier tariffs from the European Union on Chinese-manufactured electric vehicles.
According to a recent update from IDTechEx Technology Analyst Mika Takahashi, a show floor once dominated by European auto giants and their combustion engine vehicles now found itself filled with Chinese carmakers of all segments and sizes — as they were “the hottest talking points this year.”
“BYD, Hongqi, Skyworth, Leapmotor, Forthing, Aito, Xpeng, GAC, and more were in Europe, many exhibiting for the first time,” said Takahashi, noting that “the breadth of vehicles on display shows that carmakers are not just targeting low- or high-end but are coming equipped for all segments.”
The question she poses in her update is: why have Chinese carmakers decided that Europe is the next market to expand into? Based on IDTechEx’s data, a struggling domestic market (Europe’s car market saw poor EV sales in H1 2024, while Germany’s economic situation is none the better), 2025 regulations that some European OEMs approve of and others do not, and trade tariffs may have impacted this shift.
The XPeng P7+ was one of dozens of new EVs displayed in Paris by Chinese carmakers. XPeng’s CEO confirmed the company’s commitment to the European market, describing XPengs plan as ‘long-term’. Source: IDTechEx (Analyst photograph)
“This brutal price war (in China) is expected to result in a consolidation of players as stragglers are eliminated,” said Takahashi. “In this context, it is unsurprising that carmakers are looking for alternative markets to sell their products. Europe is the perfect market for Chinese carmakers. . . .”
Based on Takahashi’s assessment of the Paris Motor Show, smaller car segments are often more popular in Europe, and the tariffs imposed on Chinese-manufactured EVs may not be significant enough to deter these OEMs (many of them have raised prices slightly — though the vehicles remain more affordable than domestic alternatives.
Takahashi concluded that 2025 “will bring major changes to the market, albeit some that not all OEMs seem prepared for.”
