European carmakers are getting their show back on the road to drive off Chinese threat
French cars have historically dominated at the Paris Motor Show but as China takes over the industry, Europe is having to put its foot on the accelerator to keep up.
Paris Motor Show, the Mondial de l’Auto, is an important showcase for French car manufacturing. French president Emmanuel Macron likes to tour the halls when the exhibition, which prominently features homegrown brands such as Renault and Citroën, comes around every other year (this edition was no exception). But when the show opened earlier this week, all anyone could talk about was the Chinese marques fanned out across the Paris Expo Porte de Versailles. The Asian powerhouse showcased a new confidence that includes technological advancements in the electric-vehicle space, at a price that has already proven attractive to cash-strapped European consumers.
But China might not be racing ahead entirely. This year’s show opened with a potential get-out-of-jail-free card for European carmakers, as negotiations between the EU and China led Beijing to agree to export quotas for Chinese hybrid vehicles, which have been flooding the European market. The news was cautiously welcomed by the Europeans who Monocle spoke to on the ground at the show. “Anyone embraces fair competition,” said the CEO of Renault-owned Romanian brand Dacia, Katrin Adt. “But it’s difficult to compete against competition that might not be fair.”
Fairness is in the eye of the beholder. A decade ago, it was China that sought to limit access to its domestic market and to force Western companies to partner with local players. Now the tables have turned: overproduction and an increasingly sluggish domestic market is prompting China to push its cars abroad. Europe, which once profited from selling cars in China, is now the one protecting its own market. As he toured the Motor Show, Macron emphasised the importance of Made in Europe and welcomed the EU deal that limits the number of Chinese hybrids entering the continent.
But Made in Europe (or China) is also a fluid concept these days. German designer Stefan Sielaff shaped the luxury cars that Chinese brand Zeekr had on its stand near Mercedes-Benz, which is itself approximately 20 per cent Chinese owned. Mercedes-Benz’s Chinese stake is so large that it could be barred from selling in the US under newly proposed legislation that would cap Chinese ownership at 15 per cent.
China’s agreement to – at least partially – level the playing field is good for Europe but it only goes so far. The continent also needs to put up a fight and prove that it can compete with Beijing on price and innovation. In France, Renault and Citroën have taken a step forward, rewiring their heritage for the 21st century. Citroën, for example, has brought back its decades-old 2CV in a playful, affordable new style. “We always want to be a bit experimental, a bit weird,” said chief designer Pierre Leclercq about the car, which comes with a ready-made picnic basket. Renault, meanwhile, is bringing back its Twingo model and Dacia brand – laying claim to some of the most affordable electric vehicles on the European market.
What’s clear is that Chinese marques are not going away, as they increasingly partner with European names and expand their manufacturing hubs into the vieux continent. The Chinese are eager to tap into long-standing European heritage and expertise, outperforming legacy brands in the process. European rivals will have to lean on more than just their own history – and government intervention – to respond.
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