China to remain top car exporter in 2025 despite slower growth on EU’s EV tariffs

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China’s top auto firms are likely to diversify by introducing petrol cars and hybrid models to blunt the impact of trade barriers

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Workers at an SAIC Motor workshop in Shanghai. Photo: Xinhua

Daniel Renin Shanghai

Published: 7:30am, 24 Dec 2024

China’s car exports are likely to hit a speed bump in 2025 as leading electric vehicle (EV) players absorb additional tariffs from the European Union (EU), the biggest overseas market where mainland-made cars enjoy a healthy profit margin.

But the country’s top automotive firms like state-owned SAIC Motor will diversify their product lines by introducing petrol cars and hybrid models to blunt the impact of the trade barriers.

According to estimates from Hua Chuang Securities, overseas shipments of cars assembled on the mainland could exceed 5.58 million units in 2025, up 14 per cent from a year earlier. That is slower than the projected 29 per cent gain this year and 58 per cent rise in 2023, it said, when China overtook Japan as the world’s largest car exporter.

In the first three quarters of this year, mainland-based carmakers reported a 27 per cent growth in exports, reaching 3.1 million units, according to research firm Canalys.

Alvin Liu, a senior analyst at Canalys, said in a research report last month that the EU tariffs would result in diminished demand for Chinese-made pure electric cars. But the bloc remains an attractive market for Chinese carmakers, who will build more hybrid vehicles to woo European customers.

“Europe remains a core market for Chinese carmakers’ globalisation efforts,” he said. “SAIC Motor is a clear example – it introduced hybrid versions of its MG3 and MG ZS models, aiming to challenge Japanese brands’ position in Europe.”