Chinese EV Makers Set To Capture 20% of Europe Market by 2028

The pace of electrification on western Europe’s roads is likely to fire up sales of Chinese-developed smart cars, where they could command a 20 per cent share of the regional market in 2028 at the expense of local peers, according to a JPMorgan forecast.

Chinese carmakers from BYD, the world’s largest electric vehicle (EV) builder, to Stallentis-backed Leapmotor, were expected to deliver 2.5 million cars to customers in countries like Germany, Italy, France and the United Kingdom in 2028, a surge of 150 per cent from about 1 million units last year, Nick Lai, head of auto research in Asia-Pacific at JPMorgan, said in an interview.

“Electrification is accelerating across Europe, creating the precise environment where Chinese OEMs’ (original equipment manufacturers’) product breadth becomes advantageous,” he said. “Investors should anticipate a continued ‘zero-sum game’ dynamic, with Chinese OEMs potentially winning share from tier-two foreign peers in Europe, Asia and Latin America.” In 2025, Chinese cars, comprising exports from China and locally built vehicles, represented 10 per cent of total new car sales in western Europe.

The US bank’s upbeat forecast could fuel optimism about Chinese EV makers’ stepped-up go-global drive amid a worldwide energy crisis and a stagnant domestic market.

JPMorgan previously predicted that Chinese cars could account for 15 per cent of new vehicle deliveries in western Europe by 2030.

Penetration of pure electric and plug-in hybrid cars in the region could also rise from 29 per cent in 2025 to 34 per cent this year, according to the bank.

Analysts said China’s carmakers and automotive suppliers were at the vanguard of EV technology and production, buoyed by government support and an appetite for innovation by consumers.

At present, most Chinese-developed EVs are fitted with preliminary self-driving systems, digital cockpits, large panels and sometimes even on-board fridges, luring thousands of domestic consumers away from established international petrol car brands.

“We believe Chinese OEMs will aim to compete in Europe with superior tech content offerings or luxury features,” Lai said. “When the new players increase their sales in the market, some of their rivals will lose their market share.” About 70 per cent of Chinese-branded vehicles bought by customers in the European Union last year were either pure electric or plug-in hybrid cars, according to data from the China Passenger Car Association. Chinese EVs also enjoyed an overwhelming production advantage over their international rivals.

Even after taking tariffs into account – 30 per cent for pure electric and 10 per cent for hybrid cars levied by the EU – shipping costs, and higher incentives to local dealers, Chinese assemblers still generated higher profitability in the European market, according to Lai. Chinese carmakers’ average net profit margin per vehicle – the gap between the selling price and production cost, as well as applicable expenses – stood at about 5,000 yuan (US$735), he said, adding that it could rise as much as fourfold to 20,000 yuan in overseas markets, where Chinese cars were sold at higher prices.

Meanwhile, the US-Israel war with Iran, which started on February 28, caused the Brent crude price to jump more than 40 per cent, fuelling the interest of European consumers in electric cars to avoid surging petrol bills.Lai said overseas markets would account for 30 to 60 per cent of some selected Chinese carmakers’ revenue in 2026, compared with 15 to 30 per cent last year.

Last week, Leapmotor, one of China’s strongest-performing EV makers this year, agreed with its shareholder Stellantis, owner of Peugeot, Fiat and Jeep, to add a line at a Spanish plant previously earmarked for Opel.The announcement came less than two months after Leapmotor opened its first overseas research and development hub in Munich, aimed at tailoring models to international customers.

In November, McKinsey forecast that up to five Chinese vehicle assemblers, leveraging their technology and production advantages in building electric cars, were likely to make the list of the world’s top 10 carmakers by 2030, disrupting the pecking order in the global automotive industry.

BYD and Geely Holding Group, which owns Volvo Cars, were among the world’s 10 largest automotive groups in terms of sales last year.