ChineseFirmsPressAheadinEuropeDespiteRisingBarriers

Chinese companies are pressing ahead with expansion in the European market despite mounting geopolitical hurdles and trade protection measures, industry leaders said at a Caixin forum in London on Thursday.

“Economic security and national security are two sides of the same coin,” said Patrick Horgan, a board member of the Great Britain China Centre, at the second Caixin London Atlantic Dialogue. He pointed to European trade defense tools, such as the Foreign Subsidies Regulation and the International Procurement Instrument, as a response to the China-EU trade deficit and measures taken by the U.S.

Despite these headwinds, there are significant opportunities for Chinese companies to expand in the European market, Horgan said. China’s competitive advantages in products, technology and pricing are highly significant for Europe’s energy transition.

Company executives attending the event said the tougher landscape does not mean Chinese companies are retreating. Instead, they are trying to adapt by localizing operations and broadening the products and services they offer in Europe.

Bono Ge, country manager for the U.K. and Ireland at BYD Co. Ltd., said the auto industry is deeply dependent on global cooperation and BYD is inevitably exposed to the challenges posed by geopolitical volatility. But he said BYD still sees substantial room in Europe, not only for electric vehicles (EVs) but also for broader energy solutions such as storage systems.

Ge described an integrated model in which consumers generate electricity through solar panels, store it in battery systems and then use cheaper power to charge their EVs. In that setup, cars can also function as mobile batteries and storage devices, and could eventually generate revenue through electricity trading.

His comments come as some media outlets and foreign policymakers have portrayed Chinese automakers’ overseas expansion as little more than an attempt to offload excess capacity. Ge pushed back on that characterization, saying BYD began building production capacity in Europe nearly a decade ago through electric buses.

The Chinese EV-maker is now moving deeper into localized manufacturing. It has established a factory in Hungary to produce new-energy passenger vehicles, Ge said. The plant is currently in trial production and is expected to gradually ramp up output in the second and third quarters of 2026, he added.

Shawn Ma, head of business development at Ant International’s WorldFirst and the company’s U.K. general manager, said Europe is far more complex than either China or the U.S. because it is not a truly unified commercial environment.

“Europe has been highly fragmented over the past decade, with distinct characteristics in language, culture and regulation,” Ma said. “A business that performs very well for us in country A does not necessarily succeed in country B,” he added, noting that companies must pay close attention to geopolitical shifts and local market sentiment when deciding how to enter new European markets.

Contact editor Kelsey Cheng (kelseycheng@caixin.com)