Chinese EV Brands Are Facing a Hard Time in Europe, But Not Chinese EVs Themselves

Check NIO, for example. The company started selling cars in Norway in September 2021, expanding to Germany, Sweden, Denmark, and the Netherlands in 2022. That means it has been selling cars in Europe for over a year already. According to Schmidt Automotive Research, the company is yet to convince European customers to purchase its vehicles in higher volumes. Curiously, NIO is the only company to offer battery swapping, and it already has deployed Power Swap stations in some countries, which is quite an advantage. Despite that, sales have been low. The research company was kind enough to share the data with us, but it is exclusive to subscribers, so I decided just to give you an overview; you may consider becoming their client should you need more details.

Selling luxury cars seems to be the issue: the more conservative public in Europe would not be willing to try new names, only traditional ones. The exception is Polestar, which is a Swedish brand controlled by Geely, a Chinese company. Its cars also come from that country, which shows once again that things may not be bright for Chinese brands but are not going that badly for Chinese BEVs. Volume brands are doing better but are also facing some bumps along the way.

BYD already sells its cars in Norway and is starting to deliver them in other markets, such as France and Portugal. Initially, the company only sold its most sophisticated vehicles, but it is quickly expanding its lineup with models such as the Dolphin and the ATTO3.

My colleague Yan Lethuillier recently evaluated the Dolphin for Frandroid and said he never thought he would rank it so severely. The main culprits are the driving aids in the vehicle, which do not behave well on narrow roads. The French journalist said they are "catastrophic" and dangerous because the lane-keeping assistant just swerves the car whenever a white line approaches.

Lethuillier faced something similar with the MG4 but not as bad as what he experienced with the Dolphin. He was also unhappy about the Linglong tires, also used by the Dacia Spring. BYD promised to fix the lane-keeping assistant before the first units reach their owners in France. There was no word about the Linglong tires, which probably means buyers will have to put up with them.

Finally, we have Ora, a brand from Great Wall Motors (GWM). The Ora Funky Cat (also called Good Cat) just arrived in Germany, where ADAC evaluated it. Europe's largest automobile association discovered that the Funky Cat has a serious safety defect with charging. BEVs usually stop charging when they are unlocked, which allows the driver to disconnect the charging cable. In the Funky Cat, although the plug can be removed, the current keeps flowing, which makes sparkles fly when the connector is taken out of the charging port. The engineers responsible for the tests also heard a loud pop and detected a burning smell. According to the association, that may "lead to worn contacts and heating of the contact surfaces."

ADAC asked GWM about the situation and heard back that it "worked very closely with the TÜV and IDIADA as an independent testing and quality assurance organization" for the homologation of the Funky Cat and that it fully complies with all regulations. In other words, that's how the vehicle is, and the company does not intend to change that. The association reported the issue to Kraftfahrt-Bundesamt (KBA, the Federal Motor Transport Authority). It also advised anyone who decides to buy the Ora to always interrupt the charging process in the stall before removing the cable and to pull out the plug as carefully and slowly as possible. That will make sales in Germany more difficult, particularly with GWM's decision not to address ADAC's concerns.

Although it is still early for a fair assessment of how most Chinese brands will fare in the European market, this beginning may show that SAIC and Geely took the right road when they decided to purchase European brands. Geely has some experience with these Troyan horses and even created one with Renault that is christened accordingly: Horse Powertrain. In a way, these European brands sound more familiar to more conservative customers and break the trust barrier that BYD, NIO, Xpeng, and GWM will have to overcome. Improving quality and avoiding safety issues would also help a lot.