【By Observer Net, Xiong Chaoran】In the European electric vehicle market, as Chinese automakers continue to expand, German automobile manufacturers are seeking to launch a new wave of counterattack.
According to the UK's Financial Times, on September 11 local time, after announcing last year that it would significantly cut down on employees and production capacity in its German factories, Volkswagen Group executives at this week's Munich Motor Show stated that the group is ready to fight back against Chinese competitors. "We are dominant in Europe and will do everything possible (by all means) to defend this position," said Thomas Schäfer, CEO of Volkswagen Passenger Cars.
Currently, Volkswagen is trying to deal with the decline in its Chinese market share and the rise of other Chinese electric vehicle competitors like BYD. Schäfer believes that Volkswagen's new series of models are highly competitive, and Chinese automakers will face greater challenges when entering the European market.
After the opening of this year's Munich Motor Show, Germany's three major automakers have made frequent statements, with content including discussions about China. Mercedes-Benz Chief Technology Officer said that the company has already joined the top ranks in the electric vehicle field and does not need to fear Chinese competition; BMW Group Sales Director said that before the launch of the new iX3 model next year, the company is closely watching the fierce price war in the Chinese market.
However, the Financial Times noted that it's not only the Germans who expressed confidence this week. BYD stated that Western competitors have yet to catch up with its electric vehicle technology. "Even if some brands are catching up, I believe we still have a lot of room for development," said Li Ke, Executive Vice President of BYD's International Expansion Business.
Volkswagen Passenger Cars CEO Thomas Schäfer, official website photo of Volkswagen
The Financial Times pointed out that the latest "return declaration" by German automakers marks an intensification of competition in the European electric vehicle market, while Chinese companies have also rapidly expanded their influence in this market.
According to data from Berlin-based research company Schmidt Automotive Research, in the second quarter of this year, Chinese brands achieved a record 5.7% share in the UK and European automotive markets, and 10.7% in the electric vehicle market.
Volkswagen believes that with its new models, stronger cost base, and cooperation with American electric vehicle manufacturer Rivian and Chinese electric vehicle manufacturer XPeng, the company has the tools to fight back.
As Europe's largest automaker, Volkswagen still holds a dominant position in the region's electric vehicle market, with a market share of 30% in August of this year. According to data from Jefferies, Mercedes-Benz, BMW, and Tesla have all seen a decline in their market shares in Europe; meanwhile, BYD's share in the European electric vehicle market rose from 2.5% to 3.8%.
"We are confident that we will become the driving force behind global automotive technology in the future," said Oliver Blume, CEO of Volkswagen Group and Porsche Group.
At this year's Munich Motor Show, Volkswagen showcased four entry-level electric vehicles, planned for release next year with a starting price of 25,000 euros (approximately RMB 210,000); BMW also launched a new electric vehicle, with the iX3 SUV being the first model produced on the company's Neue Klasse platform, marking the start of a new product line, and featuring more powerful computing capabilities; Mercedes-Benz promised significant software upgrades and longer battery range, and launched a new product line.
According to Reuters, on September 8 local time, Markus Schaefer, Chief Technology Officer of Mercedes-Benz, stated that Mercedes-Benz does not need to fear competition from China in the electric vehicle sector, but is striving to reduce costs in the price war. "We have already joined the top ranks in the electric vehicle sector, so we don't need to fear China," he added, stating that the company is working with its Chinese development team to reduce costs.
Jochen Goller, a board member and head of sales at BMW Group, on the same day said that before the launch of the new iX3 model next year, BMW is closely monitoring the fierce price war in the Chinese market. However, he refused to disclose the price of the iX3 in China, which will be determined before its launch in China in the first quarter of 2026. "We have seen an incredible price war," Goller said: "Of course, we must consider the current market situation in the competitive environment."
Starting next year, BYD plans to introduce its ultra-fast charging technology in European models, and achieve production of all electric vehicles in Europe within three years. "This is a huge change," said Li Ke, referring to BYD's new battery charging system, which can add approximately 470 kilometers of range in 5 minutes.
Changan plans to launch its Deepal S07 SUV in the UK this month, priced at 39,990 pounds (approximately RMB 380,000), to establish itself in Europe. This Chinese automaker plans to open a factory in Europe in the coming years and aims to become one of the top ten car manufacturers in the UK market. Thomas Schemera, Global Chief Operating Officer of GAC International, stated that the company plans to "as soon as possible" produce in Europe to cope with higher tariffs on Chinese electric vehicles imposed by the EU.
According to reports, analysts pointed out that one of the challenges faced by companies is how to establish brand differentiation in the minds of European consumers as more and more Chinese brands enter the European market.
Some European automotive executives believe that it is not easy for Chinese brands to achieve the same cost competitiveness as in their domestic market in Europe because of higher labor and energy costs in Europe.
Li Ke of BYD said that the company's experience in manufacturing in Thailand has taught it how to maintain cost advantages, and it will build factories in Hungary and Turkey. "We have clearly learned how to control manufacturing costs," she added.
From September 9 to September 14, the 2025 German International Motor Show (IAA MOBILITY 2025, abbreviated as "Munich Motor Show") was held in Munich. Two years ago, at the previous Munich Motor Show, the Chinese electric vehicle industry had once amazed the world and gained great fame.
September 6, 2023, Munich, China's BYD booth at the Munich Motor Show. Visual China
"Chinese hybrid and electric vehicles strongly entered Munich, entering the European market," reported Bloomberg on September 1 local time, saying that now Chinese automakers are preparing to launch a series of hybrid and pure electric vehicles for the European market and plan to use the Munich Motor Show to initiate a new round of expansion in the region.
Julian Litzinger, analyst at the renowned European automotive market data analysis institution Dataforce, said that Chinese automakers have performed particularly well in the rapidly growing hybrid vehicle segment. "This growth momentum seems to be far from ending," he said, adding that with more hybrid models introduced by Chinese automakers, there is still potential for growth in the future.
German media cited information from the organizer, the German Association of the Automotive Industry (VDA), stating that in this year's Munich Motor Show, China was the country with the most exhibitors outside of Germany, with a total of 116 exhibitors from China. VDA said that this year's Munich Motor Show has become the most diverse platform in the history of car producers, which is undoubtedly a positive interpretation. The negative interpretation is that even at this German home show, the position of German car producers is declining - this is also the case in the global automotive market.
The automotive information platform Inovev summarized that this year's Munich Motor Show will be a "struggle for dominance between Germany and China in the electric vehicle sector." According to official data, in the first half of this year, China's passenger car sales reached 10.9 million units, while Europe's passenger car sales were only 6.8 million units. In the new energy vehicle sector, China sold 5.524 million new energy passenger cars in the first half of this year, more than three times that of Europe (1.782 million).
On September 11, the China Association of Automobile Industries released the latest news that in the first eight months of this year, the production and sales of automobiles in our country exceeded 20 million units for the first time.
Latest data shows that in the first eight months of this year, the production and sales of automobiles reached 21.051 million units and 21.128 million units respectively, an increase of 12.7% and 12.6% compared to the same period last year. Among them, the production and sales of new energy vehicles reached 9.625 million units and 9.62 million units respectively, an increase of 37.3% and 36.7% compared to the same period last year, with new energy vehicle sales accounting for 45.5% of the total new car sales.
In terms of exports, the export of automobiles reached 4.292 million units in the first eight months, an increase of 13.7% year-on-year. Among them, the export of new energy vehicles reached 1.532 million units, an increase of 87.3% year-on-year.
A relevant person in charge of the China Association of Automobile Industries said that the "two new" policies continue to exert their efforts, and fiscal interest subsidies for personal consumption loans and other policies were issued in a timely manner, with enterprises showing high enthusiasm for launching new models. The work of industry rectification and "internal competition" continues to show results, and the overall operation of the automotive industry remains stable.
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