Chinese carmakers sold more vehicles than their South Korean rivals in Western Europe, including the United Kingdom, for the first time in September, according to a newly released analysis.
Chinese automakers’ market share in the region reached 8% in September, narrowly surpassing their South Korean rivals at 7.8%, according to data from German firm Schmidt Automotive Research.
Chinese participation fell to 6.8% from South Korea’s 7.2% in October, but analysts say the September figures signal the start of a trend.
“While the Koreans are alone – Hyundai and Kia are one company – the Chinese are already a swarm, and Changan, Xiaomi and others will soon join them,” said Ferdinand Dudenhoeffer, director of the Automotive Research Center in Bochum, Germany.
“The market is very competitive, especially in China, where each manufacturer is constantly increasing its production capacity. This market will become even more powerful in the next ten years and will relegate the Japanese and Koreans to the bottom of the world rankings,” he said.
Between January and September, Chinese automakers sold 503,321 units in the region, an increase of 77.5% from the previous year – far higher than the overall market growth of just 1.1%, according to Schmidt data.
Importantly, this impressive performance comes despite the European Commission imposing countervailing duties on Chinese-made battery electric vehicles (BEVs) from October 2024, due to allegedly unfair subsidies from Beijing.
The number of Chinese models sold doubled between July and September compared to the same period in 2024, when the tariffs were not yet in effect.
Although the figures suggest that Hyundai and Kia are becoming less competitive in Europe, analysts say this does not represent a significant loss for these automakers. Its market share between July and September decreased by only 0.4% year-on-year, compared to a stronger drop of 1.8% for its Japanese competitors. This reduced Japan’s market share to 12.5%, according to Schmidt.
“The news is that Chinese automakers have narrowed the gap with a stable Korean market share, to the detriment of established European automakers, mainly Stellantis, Japanese automakers and Tesla,” Mattias Schmidt, founder of Schmidt Automotive Research, said in an interview with “Nikkei Asia.”
“Korean automakers are holding on and appear to be doing well in a hyper-competitive new world where new automakers have cornered a million units in the already saturated Western European market this year,” he said.
Schmidt attributed the poor performance of Japanese automakers to a lack of battery electric vehicle (BEV) supply, especially as the category is expected to account for 20% of the Western European market for the first time this year. Only 4.3% of Japanese vehicle registrations in Western Europe are BEVs, compared to 20% in South Korea and 37% in China in the January-October period.
A Hyundai Motor Company spokesperson expressed confidence in the company’s position in Europe, highlighting its extensive dealership and service network as its differentiator. South Korean and Japanese concessions are already common in Germany, while Chinese concessions are still rare.
Other observers believe the scenario could become much more competitive as more Chinese brands enter Europe and offer lower prices.
“(South Korean automakers) make excellent cars in a variety of price ranges, and Kia and Hyundai are very popular brands here,” said Jorn Gronkjaer, president of the Danish Electric Vehicle Association. “But the large number of Chinese brands and generally low prices will make it difficult for Korean brands to compete.”
Mattias Bergman, CEO of Mobility Sweden, cited statistics from the US think tank Conference Board showing that although the number of vehicles imported from China into the European Union has increased, their value has stagnated following the bloc’s imposition of tariffs.
According to the Conference Board, the average import price of a Chinese BEV in July was almost US$9,000 cheaper than the peak import price in the first half of 2023.
“The tariffs put pressure on Chinese electric vehicle makers to reduce the price of imports to remain competitive and also focus more on hybrid and plug-in hybrid cars (which are not subject to import duties) to avoid tariffs,” Bergman said.
Schmidt Automotive Research predicts even stronger growth for Chinese automakers in 2026, with Chery, China’s largest auto exporter, launching new models, and GAC (Guangzhou Automobile Group) and Changan Automobile Group arriving in Europe.
Canadian automaker Magna announced in late November that it had started manufacturing GAC’s Aion SUV in Austria. This follows XPeng, which in September began production of two electric SUV models in partnership with Magna in this country.
Changan is also preparing its Deepal brand for the region. BYD will expand its model range and plans to launch its premium Denza brand from 2026. After some delays, BYD is expected to open its first European factory in Hungary next year.
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