Europe’s automotive industry is facing one of the most challenging periods in its history as Chinese manufacturers intensify competition and European carmakers struggle to maintain market share. The European Commission now argues that affordable electric cars will be central to restoring competitiveness, with around 200 new electric models expected to reach the market by the end of the year.
Affordable electric cars are at the heart of Europe’s industrial strategy
For Brussels, Europe’s automotive industry is in “mortal danger”. The warning comes from European Commission Executive Vice-President for Prosperity and Industrial Strategy, Stéphane Séjourné, who believes the electric vehicle sector has reached a critical turning point.
“We have a clear objective. We must break this vicious circle, the triple blow affecting the industry. We need to reverse the trend, prevent the loss of added value, stop losing market share and completely change the situation. To do that, we must work with industry,” Séjourné said.
Europe challenges China over affordable electric cars
The Executive Vice-President also delivered a strong warning about China, which he described as Europe’s main commercial rival in the automotive sector. According to Séjourné, Beijing has adopted “a predatory strategy” by directing its excess manufacturing capacity towards the European market.
China’s latest five-year plan has prioritised exports of electric and hybrid vehicles as domestic demand begins to weaken following years of rapid growth.
“From the manufacturers’ perspective, Chinese imports, which now account for more than 15% of electric vehicles sold in Europe, paint a worrying picture. Factories are slowing production and are on the verge of laying off workers. The situation is therefore urgent,” he said.
While European governments and industry leaders have repeatedly raised concerns over Chinese competition, this is one of the strongest warnings yet from within the European Commission itself.
“The outcome is undeniable: our manufacturers are losing market share while imports of Chinese models continue to rise. European factories are operating below capacity and the threat of mass redundancies is becoming increasingly real.”
The comments follow Volkswagen’s announcement of 100,000 job cuts, highlighting the growing pressure facing Europe’s automotive manufacturers.
Around 200 affordable electric cars expected by the end of the year
Despite the challenges, Séjourné also presented a more optimistic outlook for the European market.
“We can now say it openly: electric vehicles are arriving. Around 200 new models will be launched this year. They will be far more affordable and will also benefit from European reforms designed to simplify the deployment of electric vehicles. The models we are talking about, priced below €20,000, will become accessible to middle and lower-income households.”
For the European automotive industry, this could represent one of the most significant developments in recent years. Affordable compact electric vehicles priced below €20,000 have long been considered essential for accelerating the transition to zero-emission mobility and making electric driving accessible to a broader section of society.
Whether this strategy succeeds in restoring Europe’s competitiveness will become clear over the coming years.
Electric vehicle sales continue to grow
According to Séjourné, electric mobility continues to gain momentum.
“Electric vehicles now account for 25% of the European market and more than 35% globally when plug-in hybrid vehicles are included. Global production has reached 13 million electric vehicles, while one in five cars sold worldwide is now electric. The trend continues to strengthen, with electric vehicle sales in Europe rising by 40% during the last quarter.”
The figures suggest that demand is recovering, although Europe still faces the dual challenge of strengthening industrial competitiveness while meeting its climate objectives.
Séjourné also stressed the economic benefits for consumers.
“Drivers can save around €80 per month on fuel, while taxi drivers working in European capitals can reduce their monthly fuel costs by approximately €1,000 simply by switching to electric vehicles.”
Italy welcomes the Commission’s change of tone
The Commission’s remarks were immediately welcomed by the Italian government.
“Executive Vice-President Séjourné has finally lifted the veil of hypocrisy, effectively confirming what Italy has argued from the beginning. Europe must reconcile industrial sustainability with environmental sustainability and revise the ideological mechanisms of the Green Deal. The process of reform has finally begun thanks to Italy’s foresight, determination, responsibility and leadership,” said Adolfo Urso, Italy’s Minister for Enterprises and Made in Italy, speaking during the Italian Waste Economy event in Rome.
