Chinese EV manufacturers set to disrupt European market with affordable innovations
Shreeaa Rathi | TIMESOFINDIA.COM | Jun 10, 2025, 17:54 IST
( Image credit : TIL Creatives, TOIGLOBAL )
Chinese electric vehicle manufacturers are making waves in international markets, sparking a competitive frenzy among traditional automakers. This surge raises alarms about potential cybersecurity threats, prompting governments to implement tariffs as a precaution. In response, European auto giants are ramping up their innovation efforts to stay relevant. Notably, BYD has surpassed Tesla to claim the title of leading EV seller.
Chinese electric vehicle (EV) manufacturers are expanding into global markets, particularly Europe, with cheaper and technologically advanced cars like the BYD Dolphin Surf, raising concerns about competition for established automakers and potential security risks, while prompting governmental responses such as increased tariffs in the US and EU, and stimulating European manufacturers like Renault to innovate and adopt efficient production techniques. BYD, a Chinese company, overtook Tesla in 2024 to become the world's best-selling EV maker. The expansion of Chinese companies and brands could change the global motor industry.
The BYD Dolphin Surf, known as the Seagull in China, is a small, affordable city car. It is expected to be priced around £18,000 in the UK. While not the absolute cheapest EV, it worries established brands.
BYD aims to become the number one brand in the British market within 10 years, according to Steve Beattie, sales and marketing director for BYD UK. Other Chinese brands like Nio, Xpeng, Zeekr, and Omoda could become household names. These brands join MG, Volvo, and Lotus, which have been under Chinese ownership for years. The range of products includes runabouts like the Dolphin Surf and supercars like the Yangwang U9.
David Bailey, professor of business and economics at Birmingham Business School, notes that Chinese brands are making massive inroads into the European market. In 2024, 17 million battery and plug-in hybrid cars were sold worldwide, with 11 million in China. Chinese brands held 10% of global EV and plug-in hybrid sales outside China, and this figure is expected to increase.
However, rivalry between Beijing and western powers raises concerns about security risks from hackers and third parties. For established players in Europe, this represents a challenge to their dominance.
Mr. Bailey warns that China has a huge cost advantage through economies of scale and battery technology. He adds that European manufacturers have fallen well behind and could be wiped out unless they catch up quickly.
China's car industry has developed rapidly since joining the World Trade Organisation in 2001. The "Made in China 2025" initiative, introduced in 2015, accelerated this process. This 10-year plan aimed to make China a leader in high-tech industries, including EVs. It attracted criticism from abroad, particularly the US, amid claims of forced technology transfers and theft of intellectual property, which the Chinese government denies.
Lavish state funding helped companies like BYD grow rapidly. BYD was originally a maker of batteries for mobile phones. It also allowed the Chinese parent companies of MG and Volvo, SAIC and Geely, to become major players in the EV market.
Dan Caesar, chief executive of Electric Vehicles UK, states that the general standard of Chinese cars is very, very high indeed. He adds that China has learned extremely quickly how to manufacture cars.
Competition in China has become cut-throat, leading brands to seek sales elsewhere. While Chinese firms have expanded into East Asia and South America, the European market proved difficult until governments decided to phase out petrol and diesel models.
Oliver Lowe, UK product manager of Omoda and Jaecoo, states that Chinese brands have seen an opportunity to get a bit of a foothold.
Low labor costs, government subsidies, and a well-established supply chain have given Chinese firms advantages. A UBS report in late 2023 suggested BYD could build cars 25% more cheaply than western competitors. Chinese firms deny the playing field is uneven.
Xpeng's vice chairman Brian Gu said at the Paris Motor Show in 2024 that his company is competitive because they have fought tooth and nail through the most competitive market in the world.
Concerns about Chinese EV imports flooding international markets intensified in 2024. The Alliance for American Manufacturing warned they could be an "extinction-level event" for the US industry. European Commission president Ursula von der Leyen suggested that huge state subsidies for Chinese firms were distorting the European market.
The Biden administration raised import tariffs on Chinese-made EVs from 25% to 100%. Beijing condemned this as "naked protectionism".
In October 2024, the EU imposed extra tariffs of up to 35.3% on Chinese-made EVs. The UK, however, took no action.
Matthias Schmidt, founder of Schmidt Automotive Research, says the EU's tariffs have now made it harder for Chinese firms to gain market share. He adds that the door was wide open in 2024, but the Chinese failed to take their chance and with the tariffs in place, Chinese manufacturers are now unable to push their cost advantage onto European consumers.
European manufacturers are racing to develop their own affordable electric cars. Renault is setting up an ultra-modern EV "hub" in northern France. This hub mirrors the lean production techniques of Chinese manufacturers.
Pierre Andrieux, director of the Douai plant, explains that their target was to be able to produce affordable electric cars here to sell in Europe. He argues that automated processes will enable them to do that profitably.
Renault is also exploiting its heritage. Its latest model, the Renault 5 E-tech, borrows its name from one of the company's most famous products.
Some experts believe we should be wary of Chinese cars for security reasons. Modern vehicles are internet-enabled, and drivers' phones are often connected to car systems.
Concerns have arisen that cars could be hacked and used to harbor spyware, monitor individuals, or even be immobilized remotely.
Earlier this year, a British newspaper reported that military and intelligence chiefs had been ordered not to discuss official business while riding in EVs. It was also alleged that cars with Chinese components had been banned from sensitive military sites.
In May, a former head of MI6 claimed that Chinese-made technology in a range of products, including cars, could be controlled and programmed remotely. Sir Richard Dearlove warned MPs that there was the potential to "immobilise London".
Beijing has denied all accusations of espionage.
A spokesperson for the Chinese embassy in London says that the recent allegations are entirely unfounded and absurd. The spokesperson added that China has consistently advocated the secure, open, and rules-based development of global supply chains and Chinese enterprises operating around the world are required to comply with local laws and regulations and to date, there is no credible evidence to support the claim that Chinese EVs pose a security threat to the UK or any other country.
Joseph Jarnecki, research fellow at The Royal United Services Institute, argues that potential risks can be mitigated.
He says that Chinese carmakers exist in this highly competitive market and while they're beholden to Chinese law and that may require compliance with national security agencies, none of them want to damage their ability to grow and to have international exports by being perceived as a security risk.
He also says that the Chinese government equally is conscious of the need for economic growth and they're not hell-bent on solely conducting surveillance.
Mr. Jarnecki adds that to achieve the government's climate objectives, it will be necessary to use Chinese-supplied technology. He believes that regulators of key industries should be given sufficient resources to monitor cyber security and advise companies using Chinese products of any potential issues.
Dan Caesar concludes that even if you have a car that's made in Germany or elsewhere, it probably contains quite a few Chinese components. He also says that the reality is most of us have smartphones and things from China, from the US, from Korea, without really giving it a second thought and so he thinks there's some fearmongering going on about what the Chinese are capable of and that we have to face the reality that China is going to be a big part of the future.
The BYD Dolphin Surf, known as the Seagull in China, is a small, affordable city car. It is expected to be priced around £18,000 in the UK. While not the absolute cheapest EV, it worries established brands.
BYD aims to become the number one brand in the British market within 10 years, according to Steve Beattie, sales and marketing director for BYD UK. Other Chinese brands like Nio, Xpeng, Zeekr, and Omoda could become household names. These brands join MG, Volvo, and Lotus, which have been under Chinese ownership for years. The range of products includes runabouts like the Dolphin Surf and supercars like the Yangwang U9.
David Bailey, professor of business and economics at Birmingham Business School, notes that Chinese brands are making massive inroads into the European market. In 2024, 17 million battery and plug-in hybrid cars were sold worldwide, with 11 million in China. Chinese brands held 10% of global EV and plug-in hybrid sales outside China, and this figure is expected to increase.
However, rivalry between Beijing and western powers raises concerns about security risks from hackers and third parties. For established players in Europe, this represents a challenge to their dominance.
Mr. Bailey warns that China has a huge cost advantage through economies of scale and battery technology. He adds that European manufacturers have fallen well behind and could be wiped out unless they catch up quickly.
China's car industry has developed rapidly since joining the World Trade Organisation in 2001. The "Made in China 2025" initiative, introduced in 2015, accelerated this process. This 10-year plan aimed to make China a leader in high-tech industries, including EVs. It attracted criticism from abroad, particularly the US, amid claims of forced technology transfers and theft of intellectual property, which the Chinese government denies.
Lavish state funding helped companies like BYD grow rapidly. BYD was originally a maker of batteries for mobile phones. It also allowed the Chinese parent companies of MG and Volvo, SAIC and Geely, to become major players in the EV market.
Dan Caesar, chief executive of Electric Vehicles UK, states that the general standard of Chinese cars is very, very high indeed. He adds that China has learned extremely quickly how to manufacture cars.
Competition in China has become cut-throat, leading brands to seek sales elsewhere. While Chinese firms have expanded into East Asia and South America, the European market proved difficult until governments decided to phase out petrol and diesel models.
Oliver Lowe, UK product manager of Omoda and Jaecoo, states that Chinese brands have seen an opportunity to get a bit of a foothold.
Low labor costs, government subsidies, and a well-established supply chain have given Chinese firms advantages. A UBS report in late 2023 suggested BYD could build cars 25% more cheaply than western competitors. Chinese firms deny the playing field is uneven.
Xpeng's vice chairman Brian Gu said at the Paris Motor Show in 2024 that his company is competitive because they have fought tooth and nail through the most competitive market in the world.
Concerns about Chinese EV imports flooding international markets intensified in 2024. The Alliance for American Manufacturing warned they could be an "extinction-level event" for the US industry. European Commission president Ursula von der Leyen suggested that huge state subsidies for Chinese firms were distorting the European market.
The Biden administration raised import tariffs on Chinese-made EVs from 25% to 100%. Beijing condemned this as "naked protectionism".
In October 2024, the EU imposed extra tariffs of up to 35.3% on Chinese-made EVs. The UK, however, took no action.
Matthias Schmidt, founder of Schmidt Automotive Research, says the EU's tariffs have now made it harder for Chinese firms to gain market share. He adds that the door was wide open in 2024, but the Chinese failed to take their chance and with the tariffs in place, Chinese manufacturers are now unable to push their cost advantage onto European consumers.
European manufacturers are racing to develop their own affordable electric cars. Renault is setting up an ultra-modern EV "hub" in northern France. This hub mirrors the lean production techniques of Chinese manufacturers.
Pierre Andrieux, director of the Douai plant, explains that their target was to be able to produce affordable electric cars here to sell in Europe. He argues that automated processes will enable them to do that profitably.
Renault is also exploiting its heritage. Its latest model, the Renault 5 E-tech, borrows its name from one of the company's most famous products.
Some experts believe we should be wary of Chinese cars for security reasons. Modern vehicles are internet-enabled, and drivers' phones are often connected to car systems.
Concerns have arisen that cars could be hacked and used to harbor spyware, monitor individuals, or even be immobilized remotely.
Earlier this year, a British newspaper reported that military and intelligence chiefs had been ordered not to discuss official business while riding in EVs. It was also alleged that cars with Chinese components had been banned from sensitive military sites.
In May, a former head of MI6 claimed that Chinese-made technology in a range of products, including cars, could be controlled and programmed remotely. Sir Richard Dearlove warned MPs that there was the potential to "immobilise London".
Beijing has denied all accusations of espionage.
A spokesperson for the Chinese embassy in London says that the recent allegations are entirely unfounded and absurd. The spokesperson added that China has consistently advocated the secure, open, and rules-based development of global supply chains and Chinese enterprises operating around the world are required to comply with local laws and regulations and to date, there is no credible evidence to support the claim that Chinese EVs pose a security threat to the UK or any other country.
Joseph Jarnecki, research fellow at The Royal United Services Institute, argues that potential risks can be mitigated.
He says that Chinese carmakers exist in this highly competitive market and while they're beholden to Chinese law and that may require compliance with national security agencies, none of them want to damage their ability to grow and to have international exports by being perceived as a security risk.
He also says that the Chinese government equally is conscious of the need for economic growth and they're not hell-bent on solely conducting surveillance.
Mr. Jarnecki adds that to achieve the government's climate objectives, it will be necessary to use Chinese-supplied technology. He believes that regulators of key industries should be given sufficient resources to monitor cyber security and advise companies using Chinese products of any potential issues.
Dan Caesar concludes that even if you have a car that's made in Germany or elsewhere, it probably contains quite a few Chinese components. He also says that the reality is most of us have smartphones and things from China, from the US, from Korea, without really giving it a second thought and so he thinks there's some fearmongering going on about what the Chinese are capable of and that we have to face the reality that China is going to be a big part of the future.