CHINESE FIRMS HAVE SHIFTED FROM LEARNING TO LEADING
For three decades, China served as a major growth market. Foreign champions in sectors such as mobile phones, retail, and home appliances entered early, captured market share, and scaled rapidly. Over time, however, the domestic ecosystem moved upscale: agile Chinese companies absorbed European know-how, improved on quality and cost, overtook incumbents, and eventually expanded abroad as global leaders.
A clear example is home appliances, where leading Chinese brands increased their global market share from 16% in 2013 to 30% in 2022 — nearly doubling in less than ten years. While this transformation happened faster and was more visible in B2C than in B2B, the trend holds across sectors: Chinese firms have successfully climbed the value chain and consolidated both domestic and global leadership.
THE AUTOMOTIVE INDUSTRY IS NOW UNDERGOING THE SAME SHIFT
China has become the world’s automotive center of gravity, accounting for about one-third of global vehicle production in 2024 and nearly 80% of global EV battery output. Powered by rapid electrification, local OEMs have gained strong domestic momentum: Chinese brands represented 65% of total car sales in 2024, up from 36% in 2020.
Meanwhile, Chinese suppliers have closed the technology gap and moved up the value chain, now dominating critical components. CATL leads power batteries with roughly 45% market share in China, BYD follows with about 36%, Desay SV holds around 27% in autonomous driving chips, and Fuyao ranks first in automotive glass with approximately 66% market share.
This concentration of capabilities across the value chain has made the domestic ecosystem largely self-sufficient. The Chinese automotive market is therefore characterized by a high number of players, thin margins, and excess capacity — all of which drive companies to accelerate international expansion. This dynamic is reinforced by indirect support from overcapacity in key materials (steel, aluminum, plastics) provided by Chinese state-owned enterprises.
EUROPE HAS BECOME A PREFERRED DESTINATION FOR CHINESE AUTOMOTIVE COMPANIES, OFFERING HIGHER MARGINS AND PROFITABILITY
European imports from China have surged at an exceptional pace, rising from €2 billion in 2020 to €9.7 billion in 2022 and €12.6 billion in 2024, even after new tariffs were introduced.
Chinese companies are not only exporting more — they are now establishing a physical presence in Europe, reopening former European plants, building new facilities, and expanding supplier networks across the EU and neighbouring countries. OEMs and suppliers alike are transitioning from an export-only approach to local production tailored for the European market, primarily through assembly operations.
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