While our industry continues to direct capital towards the Great Wall, rumors report a drastic reaction to tariffs from Beijing: a halt to projects and new factories in the old continent
A incredible contradiction which tells of chaos, with the car naturally as the first protagonist. According to estimates by Rhodium Group experts, in the period April-June 2024 the European investments in China to create new companies or increase the size of existing ones have touched the peak of 3.6 billion euroswhich is double the quarterly average of 1.8 billion. The automotive sector, with Volkswagen and BMW in testawas worth 57% of the total since the beginning of the year. How are we compensated? With the rumors that reiterate what was anticipated on October 30th by the Reuters agency. The news, not confirmed nor even officially confirmable, is that of a confidential meeting held by the Beijing trade minister on 10 October with representatives of the major Chinese car manufacturers, at which the authority would have ordered to suspend all investments in Europein particular those aimed at building new factories in countries that supported or did not oppose the customs duties on electric cars of the Great Wall, which then officially came into force on the following 30 October. A clear blow that worsens the crisis diplomacy between Brussels and Beijing.
The worst premises
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The Chinese government’s initiative, which has not been confirmed, would nevertheless underline what analysts now consider a banality. Again according to Rhodium Group, already in 2023 Chinese direct investment in Europe has reached its lowest level since 2010with a total value of 6.8 billion euros. The companies Catl, Aesc and Huayou Cobalt chose Hungary, Germany and France to install Gigafactories for the production of batteries for electric vehicles, which represented 69% of Chinese investments in Europe in 2023. The next step would have been the birth of factories intended for the production of cars with traditional and hybrid engines, therefore with much greater potential sales volumes. As is known, for a long time there was talk of the potential arrival in Italy of a Chinese manufacturer, all this while Spain was actually cashing in on the agreement with Chery Auto for the creation of a production center in Barcelona. Saic Motor he is still looking for a location for the factory destined to build his Mg brand carsas well as GeelyWhile Byd has announced its intention to add a second plant for plug-in hybrid cars to its plant that will be built in Hungary. China continues to say it is not interested in a trade war with Europe, but in fact it would be preparing for forms of retaliation far superior to the appeal already initiated against the duties imposed by Brussels, at the WTO, i.e. the World Trade Organisation.
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