Xpeng CEO He Xiaopeng speaks to reporters on the electrical carmaker’s stand on the IAA auto present in Munich, Germany on September 8, 2025.
Arjun Kharpal | CNBC
Germany this week performed host to one of many world’s greatest auto reveals — however within the heartland of Europe’s auto business, it was buzzy Chinese electrical automobile corporations trying to outshine a few of the area’s greatest manufacturers on their home turf.
The IAA Mobility convention in Munich was packed stuffed with corporations with big stands exhibiting off their newest vehicles and expertise. Among a few of the greatest shows had been these from Chinese electrical automobile corporations, underscoring their ambitions to increase past China.
Europe has turn out to be a focus for the Asian firms. It’s a market the place the standard automakers are seen to be lagging within the growth of electrical autos, even as they ramp up releases of new cars. At the identical time, Tesla, which was for therefore lengthy seen as the electrical car market chief, has seen sales decline in the region.
Despite Chinese EV makers going through tariffs from the European Union, gamers from the world’s second-largest economic system have responded to the ramping up of competitors by setting aggressive gross sales and growth targets.
“The current growth of Xpeng globally is faster than we have expected,” He Xiaopeng, the CEO of Xpeng advised CNBC in an interview this week.
Aggressive growth plans
Chinese carmakers who spoke to CNBC on the IAA present signaled their formidable growth plans.
Xpeng’s He mentioned in an interview that the corporate is trying to launch its mass-market Mona series in Europe subsequent 12 months. In China, Xpeng’s Mona vehicles begin on the equal of slightly below $17,000. Bringing this to Europe would add some severe value competitors.
Meanwhile, Guangzhou Automobile Group (GAC) is concentrating on speedy development of its gross sales in Europe. Wei Haigang, president of GAC International, advised CNBC that the corporate aims to sell around 3,000 cars in Europe this year and at the least 50,000 items by 2027. GAC additionally introduced plans to convey two EVs — the Aion V and Aion UT — to Europe. Leapmotor was additionally in attendance with their personal stand.
There are indicators that Chinese gamers have made early in roads into Europe. The market share of Chinese automobile manufacturers in Europe almost doubled within the first half of the 12 months versus the identical interval in 2024, although it nonetheless stays low at simply over 5%, according to Jato Dynamics.
“The significant presence of Chinese electric vehicle (EV) makers at the IAA Mobility, signals their growing ambitions and confidence in the European market,” Murtuza Ali, senior analyst at Counterpoint Research, advised CNBC.
Tech and devices in focus
Many of the Chinese automobile firms have positioned themselves as expertise corporations, very like Tesla, and their vehicles spotlight that.
Many of the electrical autos have large screens geared up with flashy interfaces and voice assistants. And in a bid to lure consumers, some corporations have included extra devices.
For instance, GAC’s Aion V sported a fridge in addition to a therapeutic massage perform as a part of the seating.
The Aion V is likely one of the vehicles GAC is launching in Europe because it appears to increase its presence within the area. The Aion V is on show on the firm’s stand on the IAA Mobility auto present in Munich, Germany on September 9, 2025.
Arjun Kharpal | CNBC
This is a method that the Chinese gamers sought to differentiate themselves from legacy manufacturers.
“The chances of success for Chinese automakers are strong, especially as they have an edge in terms of affordability, battery technology, and production scale,” Counterpoint’s Ali mentioned.
Europe’s carmakers push again
Legacy carmakers sought to flex their personal muscle groups on the IAA with Volskwagen, BMW and Mercedes having among the many greatest stands on the present. Mercedes particularly had promoting displayed all throughout the entrance entrance of the occasion.
BMW, just like the Chinese gamers, had an enormous focus on expertise by speaking up its so-called “superbrain architecture,” which replaces {hardware} with a centralized laptop system. BMW, which launched the iX3 on the occasion, and chipmaker Qualcomm additionally announced assisted driving software that the 2 corporations co-developed.
Volkswagen and French auto agency Renault additionally confirmed off some new electrical vehicles.
Regardless of the product blitz, there are nonetheless considerations that European corporations will not be shifting quick sufficient. BMW’s new iX3 is predicated on the electrical car platform it first debuted two years ago. Meanwhile, Chinese EV makers have been fast in bringing out and launching newer fashions.
“A commitment to legacy structures and incrementalism has slowed its ability to build and leverage a robust EV ecosystem, leaving it behind fast moving rivals,” Tammy Madsen, professor of administration on the Leavey School of Business at Santa Clara University, mentioned of BMW.
While European autos have a powerful model historical past and their CEOs acknowledged and welcomed the competitors this week in interviews with CNBC, the Chinese will not be letting up.
“Europe’s automakers still hold significant brand value and legacy. The challenge for them lies in achieving production at scale and adopting new technologies faster,” Counterpoint’s Ali mentioned.
“The Chinese surely are not waiting for anyone to catch-up and are making significant gains.”