Chinese car exports rise as European buyers seek lower prices and better tech

Rising competition from Chinese carmakers is expected to put further pressure on European vehicle prices, as manufacturers face customers seeking both affordability and more advanced technology, CNBC Economy reported, citing Bain & Company. The consultancy sees purchasing habits in Western markets moving towards those in China, where fierce competition has made low prices an expectation rather than a distinguishing feature.

China’s vehicle exports to Italy more than doubled to 209,258 units in January-August, while shipments to the UK increased by about 86% to 365,672. CNBC Economy cited customs figures referenced by the China Passenger Car Association. The export growth comes as established manufacturers contend with weakening brand loyalty and greater willingness among customers to consider unfamiliar marques.

Bain’s latest Global Automotive Consumer Survey found that technology and features were a leading buying consideration for 58% of Chinese respondents, placing them ahead of price. Affordability remained the foremost concern in the US and Europe, cited by 68% and 62% of consumers respectively. Bain executives told CNBC that Chinese shoppers still cared about cost, but intense domestic competition meant manufacturers increasingly needed technology to differentiate their vehicles.

That shift could undermine an advantage long enjoyed by European carmakers. More than a third of customers in Western markets were willing to consider brands newly entering the market, the survey found. Consumers particularly interested in autonomous-driving technology were also more prepared to change manufacturers to secure better functionality. Helen Liu, Bain’s Asia automotive head and partner, said younger American and European buyers resembled Chinese consumers more closely in their receptiveness to technology.

Meeting those expectations presents different challenges for competing manufacturers, according to Bain. Emerging Chinese players need to establish their brands, while Western incumbents must improve their technology offerings without losing price competitiveness. Mass-market customers often expect advanced driving features without a substantial extra charge, CNBC reported. Bain expects manufacturers that overcome those weaknesses while remaining affordable to be best placed to benefit as the industry consolidates.