BMW boss warns Chinese carmakers will pressure Europe

BMW boss Milan Nedeljkovic warned Wednesday that European carmakers need to prepare for growing Chinese competition in their home market and likely downward pressure on prices.

“It's clear that China is having an impact in Europe,” Nedeljkovic told reporters at a new BMW battery factory in Bavaria. He said BMW had not yet felt a direct impact, but added that “sooner or later, we will face that price pressure”.

Chinese brands including BYD and Xpeng have increased exports as they face a price war at home. Automotive intelligence firm Dataforce said Chinese carmakers took almost 11 percent of the European market in May, up from just under three percent three years earlier.

Nedeljkovic said BMW would rely more on off-the-shelf components rather than its own or custom-made solutions to reduce costs. He said many vehicles in China use the same components from the same suppliers and that customers did not appear to mind.

Asked about proposed Made in Europe rules being discussed in Brussels to favour EU manufacturers in subsidies and public procurement, Nedeljkovic urged caution. “We're just hurting ourselves if we take too many unilateral measures,” he said. “They always lead to a response.”