China started making electric cars and at first it was a bit difficult, but the new Chinese models compete head-to-head with the American Tesla and the Scandinavian Polestar and for the first time they are the big stars of Europe’s biggest motor showwhich was traditionally held in Frankfurt and since last year has been held in Munich.
The great European automobile event with permission from Paris opened its doors this Tuesday and will close them on Sunday and although it is now called “mobility” (it must change with social and environmental changes) the car is still the big starespecially electric, in a year in which sales are recovering (12 consecutive months of increased registrations in Europe) after the pandemic debacle, although they are still proximately 20% below the 2019 level and new orders in recent months are less than registrations.
The big European brands will present their new electric models (combustion ones are becoming less and less), such as the new electric Minis from the BMW group, but the big stars will be the Chinese models. Companies like BYD will share the stage on equal footing with the Volkswagen group in the heart of Munich, something unimaginable a few years ago.
The effect of the mass arrival of Chinese models is also seen in the first brand in Europe of electric models, Elon Musk’s American Tesla, which has had to lower prices in the face of competition and has renewed its successful ‘Model 3’ to update it. Some Chinese models are beginning to achieve considerable sales, such as those of SAIC Motor’s MG4.
Governments seek measures to protect one of the most important European industrial sectors in terms of wealth creation, innovation and employment. One idea, which Berlin and Paris are studying, is for the European Union to implement an environmental categorization for all cars sold in Europe that would make those produced on the continent receive environmental tax benefits because, since they are not transported to Europe, they are environmentally friendly. more clean.
European luxury car brands see it as a bad idea because they know that other markets would respond with similar measures and that would harm exports outside Europe from BMW, Audi, Mercedes-Benz, Porsche or the great Italian luxury brands (Ferrari, Lamborghini or Maserati).
Some Europeans are seeking to cooperate with Chinese producers rather than compete. BMW and the Chinese ‘Great Wall’ present in Frankfurt their joint work in the development of the new, smaller and lighter chassis of the new electric Mini Cooper S, which It will be produced in China.
In addition to the change that the entry of Chinese producers into Europe represents in the market, they have achieved another change that leads them to compete with Europeans not only in price but also in innovations. To the point that now it is the European producers who seek technology transfers of its Chinese competitors, and not the other way around, as it was for decades. And they have to pay them.
Volkswagen spent $700 million in July for 5% of the Chinese brand XPeng, thus valuing it at $14 billion. Why does the large German automaker want to invest there? To have access to the new and very powerful supercalculator developed by XPengmore advanced than those who manage the German company.
In just a few years, Chinese brands have gone from being the laughingstock of Europeans because they copied the design of European cars to becoming objects of desire for European carmakers.