(Feb 28): China’s share of European electric-car sales was little changed again in January, with brands struggling to make inroads since the European Union (EU) imposed additional tariffs.

Chinese automakers led by BYD Co and SAIC Motor Corp’s MG captured 7.8% of Europe’s new electric-vehicle (EV) market last month, based on data from automotive researcher Dataforce. 

Their overall share has plateaued at between 7.5% and 8.5% for the past six months, following several years of rapid gains. The levelling-off coincides with the EU’s decision last year to apply added tariffs on EVs made in China.

Beneath the surface, a major realignment is playing out. BYD has taken over from MG, the former British sports-car maker, as Europe’s top entry from China.

China’s biggest producer of electric cars overtook MG on a monthly basis in the second half of last year, and has committed to increasing its presence in the region, from manufacturing to marketing and expanding its dealer network.

The company is also broadening its lineup. BYD is preparing to introduce the affordable and popular Atto 2 compact sport utility vehicle into all major European markets, according to people familiar with the matter. 

Pricing will start at around €28,990 (RM134,462) in France and be in that range in the other markets, the people said. Reuters reported on the French launch this week.

In January, BYD registered 4,669 EVs in the EU, UK and EFTA countries, according to Jato Dynamics, which also tracks vehicle sales. That’s 44% more than MG, and represents a widening of the 22% gap from December. 

MG parent SAIC is state-owned and was hit with the highest tariffs by EU officials, at 35.3%, on top of a standard 10% import duty. While its sales dropped 36% from January 2024, others including XPeng Inc and Zhejiang Leapmotor Technologies Ltd have stepped up their presence. 

In total, Chinese brands sold 23% more vehicles in Europe in January than last year, based on Jato figures, as EV sales jumped across the region. Jato’s figures differ slightly from Dataforce, for example excluding Chinese-owned Polestar, which would have been third behind BYD and MG.  

Another opportunity beckons for Chinese carmakers, some of which are building manufacturing capacity in Europe that will help them sidestep the tariffs.

Elon Musk’s Tesla Inc, for years the most popular EV maker in Europe, is losing support from some car buyers uncomfortable with his controversial role in the administration of US President Donald Trump. 

Musk is polling poorly among Brits, Germans and Swedes, with a survey in the latter country also finding increasingly negative attitudes towards Tesla, Bloomberg reported this week. Model Y registrations in Sweden fell 48% last month, while Model 3 sales dropped 31%.

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