The Chinese electric car market is facing a new challenge with the launch of an affordable electric car from BYD. The Seagull small electric hatchback is set to enter the European market next year, prompting local manufacturers to worry about losing market share.
The CEO of Tesla, Elon Musk, has warned that BYD’s entry into the market could threaten other manufacturers. In response, President Joe Biden has increased import duties on Chinese e-cars in the United States. The European Commission is also investigating the Chinese electric car industry for illegal government subsidies, potentially leading to higher import duties in Europe.
Despite the threat from BYD, European manufacturers like BMW, Volkswagen, and Stellantis are against protectionist measures. Stellantis CEO Carlos Tavares emphasized that protectionism is not a long-term solution for competition. European car makers are more dependent on the Chinese market and could face retaliation if higher import duties are imposed in Europe.
In anticipation of possible tariffs, BYD is expanding its presence in Europe by building an electric car factory in Hungary. The company’s European CEO, Michael Shu, has hinted at a second European production site by 2025 to mitigate the impact of potential higher import tariffs. Ultimately, the introduction of BYD’s affordable electric car is shaking up the European market and pushing manufacturers to adapt to increased competition.
