Chinese automakers lose ground in Europe after record 2025 finish

(Bloomberg) -- Chinese automakers took a step backward in Europe, losing ground during January after capturing a record share of the region’s new-car sales at the end of 2025.

Brands led by BYD Co. and SAIC Motor Corp.’s MG accounted for 15% of hybrid models registered in Europe last month, down nearly 3 percentage points from December, according to researcher Dataforce. The Chinese share of fully electric cars fell by a similar margin to 12%.

The setback is likely to be temporary, after a year in which BYD, Omoda and Jaecoo cars became more common on roads from London to Rome and Madrid. Zhejiang Leapmotor Technology Co., which sells through Stellantis NV dealers in Europe, is in talks to expand its partnership with the parent of Opel and Fiat, Bloomberg reported this week.

Leapmotor showed “a correction to the growth path in January" after its strong climb throughout 2025, said Julian Litzinger, a Dataforce analyst. MG pushed sales into rental and fleet channels ahead of January’s drop, he added.

Chinese automakers’ presence in the region is only set to deepen as long-term commitments take root. Chery Automobile Co., the owner of Omoda and Jaecoo, has started assembling cars in Barcelona through a venture with Spain’s Ebro EV Motors, and BYD is setting up a factory in Hungary that’s due to ramp up output this year.

Except for US tariffs, competition from Chinese manufacturers is “the biggest fear for investors" in European automakers like Stellantis, Volkswagen AG and Renault SA, Citigroup analyst Harald Hendrikse said in a note this week.

Brands in Europe have taken steps to meet the challenge, updating their lineups with more models that combine a battery and an engine. Stellantis has introduced a hybrid Fiat 500, while Volkswagen is set to unveil hybrid versions of the T-Roc SUV and Golf this fall.

Even as the industry is walking back its electric ambitions, manufacturers are introducing more affordable EVs. Renault is getting ready to sell its electric Twingo city car, while Audi plans to launch a battery-powered version of its entry-level A2 hatchback in the second half.

--With assistance from Albertina Torsoli and Monica Raymunt.

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