Chinese automaker Chery plans to make cars in Spain, where the EV market accounts for just 12%, part of that of Portugal and France. This would be Chery’s first production in Europe.
It’s all part of the Chinese brand’s ambitious plan to identify three brands in Europe and launch three new models for the brand, until 2026. Unfortunately, however, Chery needs to offer ICE cars with its cheap electric cars, adding a luxury brand of gasoline-powered SUVs that it already sells in China. The automaker plans to launch its first electric vehicle in Germany during the first component this year: the Omoda 5 EV, which has a starting value of 37,000 euros (about $39,750).
Spain’s Industry Ministry said in a statement that the deal would be formalized in the coming days and Chery plans to start production in Barcelona, according to Reuters. Given the slow adoption of electric cars in Spain, Chery has announced plans to manufacture combustion engines. , hybrid and electric cars there.
According to Automotive News Europe, the negotiations revolve around Chery’s production of its cars at the former Nissan plant, which closed in 2021 and where another 1,600 people lost their jobs, with plans to repair at least some of those jobs.
It was unclear whether or not Spain has submitted special state aid to dissolve the deal, but Catalonia’s regional government will send its most sensible industrial official to China to meet with Chery leaders this week. Companies will apply for a total of €1. 7 billion in loans and grants for the production of electric vehicles, which is part of the PERTE incentive scheme that is based on European pandemic relief funds, according to Automotive News Europe. The former Nissan plant was partially sold to Spanish electric motorcycle company Silence, as well as local engineering teams QEV and EV Motors, who planned to turn the plant into a hub for electric vehicles. EV Motors now has the centre completed and is involved in negotiations with Chery, with sources telling Reuters that EV Motors also plans to produce electric trucks and vans there under its Ebro logo along Chery.
In March, Chery was reportedly in talks with Italy, another European country where EVs have an incredibly low market share, about building a factory there, but sources say those plans have stalled and the company is moving forward with Spain.
Chery said providing a combination of ICE and EVs is part of its business plan in Europe, giving the company flexibility in other markets where EV adoption is lagging, basically because governments have come up with only minimal incentives compared to Germany, for example.
Still, while Europe doesn’t want ICE cars from China, the expansion of Chinese electric cars is underway: BYD is pushing foreign expansion with its plan to build an electric vehicle plant in Hungary and other automakers will set up production in Europe. . Chinese corporations MG, BYD and Chery have also been at sites in Mexico and have spoken to officials about greater access to the North American market. MG plans to build a $2 billion plant, while BYD is ramping up multi-billion dollar investments in its own plant, moves that have set off alarm bells in Washington.
Europe is also contemplating imposing retroactive price lists on electric cars coming from China after officially discovering that China heavily subsidizes electric cars it exports to Europe.
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Jennifer is an editor at France-based Electrek, previously working at Wired, Fast Company, and Agence France-Presse. Send them comments, suggestions, or recommendations via X (@JMossalgue) or jennifer@9to5mac. com.