The 90th Paris Motor Show, one of the world's top five international auto shows, concluded on October 20 local time. This year, the historic auto show regained its popularity. Amidst the impending EU tariffs on Chinese electric vehicles, the booths of Chinese automakers attracted particular attention.

A total of 48 automotive brands from around the world participated in this year's Paris Motor Show, with nine Chinese brands accounting for approximately 1/5 of the total. Among them, Chinese automakers such as FAW Hongqi, BYD, XPeng, Leapmotor, and GAC actively participated with new products and technologies. The New York Times reported that Chinese automakers were unaffected by the EU's countervailing tariffs and leveraged the Paris Motor Show platform to fully demonstrate their ambition to deepen their presence in the European market.

▍Tariffs did not dampen Chinese automakers' enthusiasm

Unlike globalized multinational automakers, Chinese automakers have been vigorously expanding their presence overseas and pursuing globalization in recent years, with international auto shows serving as optimal showcases. According to statistics, Chinese automakers such as FAW Hongqi, BYD, AITO, Dongfeng Fengxing, Skywell, GAC, XPeng, Leapmotor, and SAIC MAXUS showcased their new energy vehicles and overseas expansion ambitions at the Paris Motor Show.

Despite the looming threat of hefty EU countervailing tariffs, Chinese automakers are not about to abandon the European market, as evidenced by the numerous Chinese exhibitors at the Paris Motor Show. As a leader in China's electric vehicle market, BYD was naturally present at the Paris Motor Show. BYD unveiled the Sea Lion 07, a rival to Tesla's Model Y, which has already launched in China and is scheduled to enter the European market in 2025. In 2022, BYD made its European debut at the Paris Motor Show and has since introduced eight models in two years.

Despite its opposition to EU tariffs, Stella Li, BYD's Executive Vice President and President of BYD America, remains confident in BYD's prospects in the European market. She stated that BYD could convince German consumers to choose its vehicles within six months.

GAC Group officially announced its "European Market Plan," which includes actively exploring the establishment of a technology center in Europe. GAC plans to introduce its products to select European countries within the year, complete the construction of a European transit warehouse by 2025 to enhance parts supply efficiency, and gradually establish a service support system covering most European countries by 2028. Its first model, the Aion V, will be introduced to European consumers next year.

Leapmotor introduced its C10 SUV and T03 city electric vehicle to the European market in September this year and unveiled the new Leapmotor B10 at the auto show. Leapmotor revealed that the B platform is a crucial part of its globalization strategy, with plans to launch multiple models by 2025. Notably, Leapmotor CEO Zhu Jiangming, Stellantis CEO Carlos Tavares, and Leapmotor International CEO Xin Tianshu appeared on stage together for the first time at the auto show.

Carlos Tavares remarked that Leapmotor is one of the fastest-growing and most impressive new forces in China, with local dealers and investors expressing "obvious" interest due to the market's urgent need for technologically proficient and reasonably priced electric vehicles. Currently, Leapmotor International has entered 13 European countries and aims to establish 500 sales outlets in Europe by the end of 2025.

XPeng Motors also premiered its flagship model, the P7+, at the Paris Motor Show and opened presales. At the launch event, XPeng Motors emphasized Europe's significance as a core market for its long-term commitment. The company plans to introduce more new models and facelifts in the future and continuously improve its after-sales network and service quality. Notably, French President Emmanuel Macron, the host of the auto show, visited the XPeng booth and suggested investing in France as soon as possible.

In addition to Chinese automakers, automotive component suppliers such as Huawei Cloud Automotive Solutions and Sunwoda Batteries also exhibited at the Paris Motor Show, aiming to expand their supply networks overseas.

▍Automakers compete in the 'entry-level' segment

Currently, European automakers face multiple challenges in their transition to electrification, including cost-conscious consumers, slowing demand for electric vehicles, slower-than-expected rollout of charging stations, and intense external competition.

According to JATO Dynamics, the average retail price of electric vehicles in Europe reached 66,000 euros (approximately 511,000 Chinese yuan) in 2023, while the average retail price of Chinese electric vehicles was approximately 32,000 euros (approximately 248,000 Chinese yuan), less than half of the European price. Although many European automakers are developing inexpensive models priced around 20,000 euros (approximately 154,000 Chinese yuan), they are not expected to enter the market until 2025 at the earliest.

Data shows that pure electric vehicle sales in the EU fell 43.9% year-on-year in August, marking the fourth consecutive month of decline. The high price of electric vehicles is a significant factor, causing interested European consumers to reconsider, and the EU's proposed tariffs on Chinese electric vehicles could exacerbate this situation.

Tim Urquhart, Chief Auto Analyst at S&P Global, believes that the EU's mandatory shift to pure electric vehicles is becoming increasingly problematic, especially given their high acquisition costs and the lack of charging infrastructure for many Europeans to recharge at home.

To reverse this trend, automakers such as Stellantis, Renault, Volkswagen, Hyundai, and Tesla plan to introduce affordable electric models priced at 25,000 euros in the European market. Renault unveiled the new R4 at the auto show, expected to cost less than 35,000 euros, and the new R5 priced at 25,000 euros. Additionally, Renault showcased a prototype of the electric Twingo, expected to retail for less than 20,000 euros upon its 2026 launch.

Brands like Citroen and Skoda also introduced electric vehicles priced below 35,000 euros at the Paris Motor Show. Citroen CEO Thierry Koskas stated that the company will launch electric vehicles priced below 20,000 euros in the first half of next year, further lowering the entry barrier for electric cars. The Dacia Bigster SUV will launch in Europe early next year with a starting price below 25,000 euros.

Moreover, the C3 Aircross from the Stellantis Group, produced on the Group's Smart Car platform, will offer low-cost pure electric and internal combustion engine versions. The entry-level model priced below 20,000 euros is expected to launch in the first half of next year. The B10, a collaboration between Stellantis and Leapmotor, will also be a crucial product in the affordable segment.

Judging from the focus of automakers at this year's auto show, electric vehicles have emerged as the core driver for the global automotive industry's new growth cycle. Multinational automakers have become acutely aware of their development gap with Chinese companies in the new energy sector and are accelerating their entry-level product layouts to reverse the current unfavorable situation. They showcased various new energy vehicle models and cutting-edge technologies, aiming to seize the "window of opportunity" amid tariff protection policies and accelerate their pursuit of Chinese automakers in the electric vehicle transition. As reported by Germany's Handelsblatt, despite facing EU tariffs, Chinese automakers remain determined to expand their presence in the European market.

Typesetting by Yang Shuo