China-europe energy storage vehicle accessories

Should China invest in Europe's battery and EV supply chains?

Chinese firms have also become major investors in Europe’s battery and EV supply chains. This influx of Chinese foreign direct investment presents Europe with a strategic dilemma. There are clear short-term benefits: Chinese investment expands production capacity, sustains regional jobs and accelerates the decarbonisation timeline.

How much do EVs cost in China?

By 2024, one in four EVs sold in the EU was made in China – a dramatic rise from almost zero in 2019 (Transport & Environment, 2024). These vehicles retail at an average €32,000 (Sebastian et al, 2024), presenting an attractive option for cost-conscious consumers and a formidable challenge to domestic producers.

Will EU duties be extended If EVs come from China?

First, once Chinese EV manufacturers start producing in Europe, duties could be extended to cover parts and components if more than 60 percent of a vehicle’s value originates from China, or if EU value added falls below 25 percent – thresholds that are consistent with EU anti-circumvention rules (Regulation (EU) 2016/1036).

Is Chinese FDI a good investment for Europe's EV & battery sectors?

In this context, Chinese foreign direct investment (FDI) into Europe’s EV and battery sectors is accelerating. This influx of capital offers clear benefits: it helps scale up production, creates regional jobs and supports achievement of climate targets. But it also raises strategic issues.

Does China import electrical equipment into Germany?

This pattern is illustrated by a significant surge in imports of electrical equipment from China into German states such as Thuringia, where CATL began building its battery plant in 2019, and Brandenburg, home to Tesla’s gigafactory, which broke ground in 2020 (Figure 3). Newer projects show signs of greater integration.