In February of this year, Omoda appeared in Spain with force. At an event in the capital of Spain where the Chinese ambassador attended, the Chery group company explained its expansion plans in our country. It arrived with the clear objective of positioning cars of all types in the market, from Omoda combustion engines to electric ones, including Jaecoo plug-in hybrids.
Just two months later, what was already an open secret was confirmed. Chery would use the former Nissan plant in Barcelona to assemble its new vehicles. Omoda and Jaecoo would be joined by Ebro, an old Spanish brand rescued by the Chinese conglomerate and which, in reality, will highlight products from Asia.
The plans were good news for a plant that would return to employ 600 people and that, they hope, it will reach a thousand workers once it operates at full capacity. For now, the plan is to assemble kits already assembled in China to finish the cars in Spain. That is to say, a production plant was not going to be set up where a vehicle is created from scratch in our country. The idea is to assemble them as a kind of puzzle that ends in Barcelona.
The detail is not minor because this requires less investment and, above all, it was expected that it would be a small trick that would allow Chinese manufacturers to sell their electric vehicles in Europe without having to pay the high compensatory duties (known as tariffs) that The European Union is determined to confirm as of next November.
Now, however, Chery has announced that delays his plans until September/October 2025as already announced The Automotive Tribune, at the beginning of September. The delay extends to all its engines, including gasoline models, although Ebro is expected to begin operations on November 18.
It is the latest chapter in a trade war between China and Europe where Spain is risking part of its future as an automobile industry.
between two lands
In this change of plans, Chery has pointed to the so-called tariffs on Chinese electric cars. This European protectionist measure has imposed some 38% countervailing duties to the import of the Chinese group’s cars, with the European Union alleging that they did not collaborate in the investigation.
The compensatory duties have different sections, calculated based on the collaboration of the brands with European investigations and the involvement of the Chinese Government in the economic push for them. BYD, for example, has been at 17.4% countervailing duty and Geely at 19.9%. Others such as SAIC, owned by the State and which have not collaborated, have also been punished with a 38% extra cost on their imports.
To all these figures we must add the 10% tariffs that were already applied to imports of cars that came from China, so Chery cars almost have to pay 50% more extra cost than before the application of these measures.
These figures, as we said, the Chinese manufacturers hoped to bypass by manufacturing in Europe or in countries with economic treaties with the European Union. Hungary will receive a BYD factory. Türkiye awaits the same and Morocco wants to position itself as a key player in this new context.
The other option, cheaper and faster, was to assemble kits of an already half finished in china that you only have to ride in Europe. In the case of Chery, in Barcelona. But the European Union, they explain in Automotive Newsis determined to avoid this trap, forcing Chinese manufacturers to make minimal investments in our continent in order to avoid tariffs on their electric cars. This calls into question the viability of Omoda’s strategy.
Consequently, its plans have been delayed and it is not the first time that China has issued warnings of a trade war with Europe if it applies tariffs that it considers too high starting in November, when a meeting between European heads of state is expected to finalize to finalize this matter.
Spain has to find its place in a changing industry, with European manufacturers threatened by Chinese companies and a country that needs cheap cars
The resolution is key for Spain. The automotive sector generates 8% of the GDP in our country and over the years it has added production plants from Stellantis (Vigo, Figueruelas, Madrid), the Volkswagen Group (Martorell, Pamplona), Mercedes (Vitoria), Renault (Valladolid, Palencia) or Ford (Almussafes) are just some examples.
All of them are manufacturers threatened by the arrival of cheaper Chinese cars with the ability to gain ground in a market where low-cost vehicles have a lot of space. According to ANFACthe Dacia Sandero is the best-selling car in our country. The Seat Ibiza and Arona occupy the third and fourth position. The MG ZS fights to get into the top five. And if we segment by gasoline cars (the cheapest on the market) we find all of them among the six best-selling cars.
In a context where cars continue to become more expensive, Spain needs those cheap cars and Chinese manufacturers seem to be clear that our country is a place to place their cars. In addition to Chery with Omoda and Jaecoo, Spanish ports are also presented as a gateway to manufacturers such as Arcfox (Vigo) or Maxus and MG (Barcelona) that begin their distribution in Spanish lands.
These are decisions that have shaken Spain’s position regarding its defense of tariffs to these manufacturers. In July, The Country explained that the Executive had positioned itself in favor of tariffs on Chinese electric cars although it was assumed that the Asian country would strike in one way or another against this European decision.
Previously, in June, China had already made a move by launching an investigation that targeted Spanish pork, whose exports to the Asian country are key. 23% of the pork imported into China is Spanish and amounts to 2,000 million dollars. The other major victim had been French brandy, which was also in the Chinese spotlight. Both countries had positioned themselves in favor of tariffs.
After the summer, the Government of Pedro Sánchez has reconsidered its position regarding tariffs. It seems that Spain’s position has relaxed, after a visit by the Spanish President where he described one of the cars he was able to test as an “honorary license” and where he assured that European manufacturers could also learn from their technology, as we told you in Xataka.
Spain now has to deal with a complicated context. Opening up to the Chinese market means opening up to a greater number of jobs but whose added value It is questioned by the European Union itself, which demands greater investments to avoid tariffs.
On the other side of the scale, European manufacturers have been a key player in Spanish industrialization but the trend affirms that we are heading towards a more automated sector with less labor in the plants. In other countries, Volkswagen or Stellantis have fired or they have plans to do so for thousands of employees. A trend will worsen if we do not invest in more important jobs in vehicle development, since operators will lose importance with the passing of the years.
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In Xataka | “It is playing free trade with a totalitarian State”: three experts give their opinion on tariffs on Chinese electric cars
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