China’s plan to dominate Europe worries local carmakers

China's largest car manufacturer, SAIC, announced that after a sharp increase in vehicle sales in Europe, it will build its first factory in the continent. The state-controlled company, which owns the MG brand, states that the new plant will focus on the production of electric vehicles.

The MG brand has a long tradition

An automaker spokesperson told the BBC that SAIC has not yet decided whether the MG brand electric vehicles will be produced at the location. MG vehicles, with a history of over a century, were previously manufactured in the UK until production moved to China in 2016. The spokesperson mentioned that the company is still in the process of searching for locations in Europe and working on finalizing the project. “We own a range of brands, including MG, IM, and Maxus, and we are still deciding which one will be produced at the factory,” added the spokesperson.

According to SAIC, sales of the brand’s vehicles outside of China increased by 40% in the first three months of the year. It appears that the majority of MG’s sales will be realized overseas, as the number of cars sold in Europe more than doubled during the same period, according to the company.


Photo by MG Cyberster

The automaker has faced challenges

The latest announcement comes nearly seven years after SAIC ceased assembly of MG vehicles at the Longbridge plant in Birmingham. MG stated at the time that assembly in the UK was no longer “required” and that cars would arrive in England “fully built and ready for distribution.” The Longbridge plant produced MG cars and the original Mini. It was established in 1906 and survived both World Wars.

In the following years, however, it struggled with post-war economic depression and the emergence of foreign automotive competition. The company also had to overcome strikes, mergers, changes in ownership, and a decline in stock value. Production at the local plant was halted after the collapse of MG Rover in 2005. The brand was eventually acquired by SAIC. In 2011, the MG6 model was introduced. It became the first MG car assembled at Longbridge in 16 years. The five-seater vehicle was designed in the UK but partially manufactured in China.


Photo by MG Cyberster

Chinese manufacturers are conquering the world

Chinese automakers, including SAIC, Geely, and Great Wall, have experienced significant production growth in recent years. Vehicle exports from China have been boosted by demand for electric cars and sales to Russia following Western sanctions imposed on Moscow after the invasion of Ukraine. According to official data, China exported over a million vehicles in the first three months of this year. As a result, it has surpassed Japan as the world’s largest automotive exporter.

In addition to manufacturing plants in China, SAIC also has production facilities in Thailand, Indonesia, India, and Pakistan. The company, which has joint ventures with German Volkswagen and American automaker General Motors, sold 5.3 million vehicles globally last year. Europe was the largest foreign market with over 100,000 units sold.


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