EU carmakers spend 7x more on EV production in China than at home


Transport & Environment has analysed investments of European carmakers and found that they spend 7 times more on electric car production in China than they do at home. This is down to failed EU policies, T&E suggests.

According to public announcements by European carmakers that the environmental organisation compiled, China has secured 21.7 billion euros of investment in the past year to manufacture electric vehicles while Europe secured only €3.2 billion.

Market size cannot explain the difference as the disparity is too large. China produces a third more cars than Europe does (23.5 million passenger cars manufactured in 2017 versus 17 million in Europe).

Instead T&E concludes it is “China’s ambitious mandate” or EV sales quota that requires carmakers to produce electric vehicles in the country that pushes those investments. And it is a policy that Europe lacks.


While the European Commission proposed new car CO2 reduction targets of 15% and 30% in 2025 and 2030 respectively, it fell short of any effective sales target for zero-emission vehicles. EU environment ministers meet on June, 25 again to discuss the ambition of the proposal with many countries expected to push for a strengthening of it.

For Julia Poliscanova, clean vehicles manager of Transport & Environment, this means: “The EU ministers have two choices: either we set an EV sales target to keep auto jobs at home, or allow European carmakers to go on selling dirty diesels here while investing the earnings into EV production abroad and importing back made-in-China electric cars.”

Indeed Volkswagen, Daimler and Renault-Nissan are racing to invest in Chinese EV production. Volkswagen Group aims to increase EV sales to 1.5 million globally by 2025 and will launch 7 PEV with FAW in China. Nissan has pledged €8 billion as part of a joint venture with Renault and Dongfeng and Daimler teamed up with China’s BAIC in a venture worth €1.6 billion to expand the production of Mercedes-Benz EVs to a new facility in Beijing.

Europe, it appears is still waiting for its electric car mandate.


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