Is BYD, Geely, and SAIC being selected by the European Union to initiate a countervailing investigation? The company has responded

On October 25th local time, the European Commission announced that three Chinese car companies, BYD, SAIC Group, and Geely, will be selected through sampling to initiate a countervailing investigation. At the beginning of this month, the European Union announced a countervailing investigation into electric vehicles produced in China. However, due to the large number of companies involved, the European Commission chose a sampling method to determine the final investigation target.

On October 27th, Geely told reporters from First Financial that Geely Holding Group will actively cooperate with the EU's anti subsidy investigation. Automobile is a global industry, and Geely Holding Group has always respected free trade, advocated fair competition, strictly followed the laws and regulations of various countries around the world, and participated in market competition in accordance with the law and regulations. Based on the principle of mutual benefit and win-win situation, Geely Holding Group has been continuously investing in Europe for more than ten years, not only safeguarding the iconic automotive brands in Europe, but also promoting good industrial synergies. The rapid development of new energy vehicles in China not only brings a beautiful travel experience to global users, but also serves as a strategic measure to address global climate change and promote green and sustainable development.

Previously, BYD's Executive Vice President also stated in a media interview that as an open company, BYD's governance must be transparent, open, and information sharing. So, we are not concerned about the current investigation conducted in Europe. In order to eliminate misunderstandings about BYD in the European market, BYD will share all necessary information with the European Union and continue to promote the company's development. She believes that the growth of electric vehicles is a revolution, and some people do not understand it, so they may feel worried and anxious. However, as soon as the information is released, they will discover the true situation and be worthy of questioning.

As of press release, SAIC Group has not responded to the above news.

On October 4th of this year, the European Commission issued a statement stating that a countervailing investigation procedure will be launched against imported electric vehicles from China, targeting pure electric passenger cars with nine seats and below produced in China. The investigation period covers the period from October 1st, 2022 to September 30th, 2023. Subsequently, it was reported that the European Union had started distributing survey questionnaires to electric vehicle production companies imported from China, including but not limited to multinational corporations and Chinese sole proprietorships.

Behind the investigation initiated by the European Commission, Chinese electric vehicles are accelerating their entry into the EU market. In the first half of 2023, China's automobile exports surpassed Japan for the first time, becoming one of the world's largest automobile exporting countries. Among them, the performance of Chinese new energy vehicles in the European market is particularly outstanding. According to the report "China's New Energy Vehicle Dream in Europe" released by KPMG, the share of China's new energy vehicle exports to Europe in total automobile exports increased from 19% in 2017 to 36% in 2022. According to data from the Passenger Car Association, this proportion further increased to 39.1% in the first half of this year.

In terms of specific brands, in the first eight months of 2023, the number of pure electric vehicles exported to the European Union by SAIC Group's brands, MG, Geely, and Volvo, were 68815 and 24623, respectively. In August of this year, the MG 4 ranked sixth on the European new energy vehicle sales chart, with monthly sales of 6733 vehicles.

Although BYD currently has average sales performance in Europe, as the world's top selling brand of new energy vehicles, it has been accelerating its expansion in Europe since last year, which will undoubtedly attract attention from the European Union. Last October, BYD made its debut at the Paris Auto Show and opened its entry into the European market. In just one year, BYD has entered 19 European countries.

In addition, new Chinese automakers such as NIO, Aichi Motors, Lando Motors, and Xiaopeng Motors have also entered the European market and gained a certain market share. Not long ago, Nezha Motors also announced that it will enter the European market.

Zhang Yong, co-founder and CEO of Nezha Automobile, stated in an interview with reporters that for the EU's anti subsidy investigation, we can only meet local regulatory requirements. For Nezha Motors, no matter how difficult it is, they must enter the European market, and early entry has a first mover advantage, while late entry may be even more difficult.

In response to this countervailing investigation, European car companies such as Volkswagen and BMW have raised objections and are even concerned about triggering a "boomerang effect". Recently, Porsche CFO Lutz Meschke told the media that this investigation is not very helpful for the European Union, especially for German car companies that heavily rely on exports to China.

Volkswagen Group CEO Obom also stated that we advocate for fair competition, but protectionism should not arise as it will lead to more protectionism. We should pay more attention to how to create competitive industrial conditions here, and if we are strong enough ourselves, we don't have to be afraid of competition outside of Europe.

Recently, Tang Weizhen, the global CEO of Stellantis Group, which invested 1.5 billion euros to acquire about 20% equity in Zero Run Automobile, told a reporter from First Financial that Stellantis Group is not the initiator or promoter of any investigation. Although the competition in the automotive industry is very fierce, global cooperation and high collaboration are needed when facing global issues such as climate change and health. Investigation is not the best way to solve problems.