Beyond Exports: Chinese Automakers Build a Production Footprint in Europe

Chinese automakers are moving beyond exports as they expand their manufacturing presence across Hungary, Sweden, Belgium, the United Kingdom, Spain, Austria, and Slovakia. Their European footprint is taking shape through four main localization pathways: greenfield investment, European manufacturing assets under Chinese ownership, joint-venture production, and third-party contract manufacturing.

🔹 Greenfield Investment: BYD Leads, SAIC Prepares to Follow

BYD is leading the greenfield push with its passenger vehicle plant in Szeged, Hungary. The project involves an estimated investment of around €4 billion and is designed for an initial annual capacity of 150,000 vehicles, with the potential to reach 300,000 units at full buildout. Vehicle assembly is scheduled to begin in the fourth quarter of 2026.

The Szeged facility complements BYD's electric bus and truck plant in Komárom.

The site was originally designed to produce up to 400 electric buses annually, and an expansion announced in 2025 is intended to more than triple its capacity.

SAIC Motor is also planning an MG manufacturing and logistics complex in Ferrol and As Pontes, in Spain's Galicia region, subject to final regulatory approval. The facility is expected to begin production in 2028 with an initial €200 million phase. The plant is projected to reach an eventual capacity of 120,000 vehicles annually following a second expansion.

🔹 European Assets Under Chinese Ownership: Geely's Established Manufacturing Footprint

Geely Holding has built a substantial European manufacturing footprint through its controlling interests in Volvo Cars, Lotus, and LEVC. Geely Holding controls multiple European plants, including Torslanda (300,000 units/year) and Skövde in Sweden, alongside Ghent in Belgium (270,000 units/year), plus LEVC and Lotus facilities in the UK. With Volvo's new EV plant in Košice, Slovakia (250,000 units/year) under construction, Geely's European footprint across these three core passenger vehicle plants will total roughly 800,000 units in annual capacity.

🔹 Joint Venture: Risk-Sharing and Local Asset Integration

Chery holds a 40% stake in its manufacturing joint venture with EBRO in Barcelona. EBRO says a newly inaugurated production line has lifted installed capacity to around 130,000 vehicles annually, while the site has longer-term potential of up to 200,000 units. Chery-branded production is expected to begin by late 2026 or early 2027.

🔹 Contract Manufacturing: Asset-Light Market Entry

Contract manufacturing has become another important localization pathway. XPENG and GAC have both selected Magna Steyr's Graz plant in Austria for European vehicle assembly.

XPENG began producing the G6 and G9 at the site in 2025. GAC subsequently launched local production of the AION V, followed by the AION UT in 2026. Magna's Graz facility has total annual capacity estimated at around 200,000 vehicles, although capacity allocations for individual Chinese brands have not been disclosed.

Meanwhile, Leapmotor—operating through its joint venture with Stellantis—is leveraging Stellantis's European manufacturing network. Production of the Leapmotor B10 is slated for the Zaragoza plant in Spain, with additional evaluations underway for an Opel electric SUV (targeted for 2028) and potential asset integration at Stellantis's Madrid complex.

🔹 Sales Momentum Meets Policy Realities

This manufacturing shift is backed by substantial commercial traction. In H1 2026, combined European registrations for Geely, SAIC, BYD, Chery, and Leapmotor reached approximately 792,000 units on a group ownership basis, capturing nearly 11% of the European market. Standout performers include BYD (174,100 registrations), Chery (155,800), and Leapmotor (56,000).

However, market expansion faces headwinds from EU trade policies. In addition to individual countervailing duties on Chinese-made battery electric vehicles (BEVs), the European Commission's proposed Industrial Accelerator Act (March 2026) aims to introduce stricter local content mandates, technology transfer conditions, and potential 49% foreign ownership caps for strategic foreign investments. In response, Chinese automakers are pivoting from pure vehicle exports to a complex, multi-tiered localized manufacturing ecosystem.

One map provides a clear view of Chinese automakers' factory locations and production relationships across Europe, while highlighting four localization pathways—greenfield investment, controlled operations, joint ventures, and contract manufacturing—offering decision-making support for site selection, partner screening, supply chain planning, and competitive benchmarking.