By Andrea Hargraves 
On the sidelines of CES 2023, Carlos TavaresCEO of Stellantis, outlined an unfavorable scenario for European builders with the arrival of Chinese construction companies in Europe.
In remarks to website to meThe Portuguese executive said that if European politicians do not support the European auto industry, manufacturers from the “old continent” will face a “terrible battle” with Chinese brands.
Tavares noted that “the price difference between the European and Chinese models is huge. If nothing changes, middle-class European consumers will increasingly buy Chinese models. The purchasing power of many Europeans is greatly reduced.”
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Electrification does not help
According to Carlos Tavares, “European regulations ensure that electric cars produced in Europe are about 40% more expensive than similar models produced in China.”
The CEO of Stellantis noted that the emissions targets in force in Europe do not “help” European manufacturers and left a warning: if the EU does not change the current situation, the European car industry will suffer the same fate as that of the mainland panel suns.
Point of no return?
Despite tracking a negative scenario, Carlos Tavares believes that this trend can still be reversed and indicates two possible paths.
On the other hand, “if we keep the European market open, we will have no choice: we have to” fight “the Chinese directly. This applies to the entire value chain in the automotive industry (…) and this will force unpopular decisions.” Among these decisions is the reduction of the production capacity of some factories and even the transfer of others.
The other way is through “reindustrialization” in Europe. Which means “resetting” some industries and production chains and, above all, “a new EU trade policy”.
However, Carlos Tavares understands that the German auto industry, in particular, will not appreciate this new trade policy. After all, such a change could affect the activities of European companies in China, one of the main markets for German brands.