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Chinese EV maker BYD Company’s cars will remain cheaper than their European rivals even if the Chinese company moves production to the continent to escape possible import tariffs, said UBS.
Advances in manufacturing and technologies will allow BYD to price its Seal mid-size car between 15% – 25% cheaper than European EVs, even if it moves production to Europe, said Paul Gong, head of China autos research at UBS.
BYD not only benefits from cheaper labor in China and low material costs but also from the advanced integrated design of its EVs, he added.
The European Commission has started a 13-month investigation into whether it should levy punitive import tariffs on Chinese EVs which benefit from government subsidies.
China has stopped subsidies to EV makers, though it has extendded tax breaks for buyers, so there is no justification to the claim that Chinese EV firms have the advantage, he said.