Another Chinese OEM sets up shop in Europe – China's GAC leverages spare capacity at Magna's Austrian facility to make European debut
- Matthias Schmidt
- 12 minutes ago
- 2 min read
China's GAC is the latest Chinese OEM to set up operations in Europe, leveraging spare capacity at contract manufacturer Magna's European Magna-Steyr Austrian operation, as we suggested earlier in the year in our client market intelligence studies.
GAC, which is in the midst of entering the West European market with the first 20 models registered across the region in September, under its Aion brand, according to Schmidt Automotive Research data, are following in the footsteps of XPeng, which announced a similar deal earlier this year.
With more European LFP battery sites coming online, this may enable Chinese OEMs to navigate EU anti-subsidy tariffs imposed since November 2024, thanks to a higher local content of vehicles made within the EU. Earlier this year, Stellantis' Leapmotor International proved that pure assembled models from CKD kits shipped from China and assembled in Europe aren't enough to circumvent the levies.
Our latest Europe Chinese OEM Market Intelligence Study published this week identifies how Chinese OEMs have been pivoting to non-BEVs, with a particular focus on PHEVs, commanding every seventh new PHEV entering the West European market during Q3 2025, in what could be a short-term mediatory stratergy to keep domestic production utilisation rates at a high rate as well as the abundance of logisitcal shipping capacity, prior to more BEV prodcution coming online in Europe which would then avoid tariffs. However, a higher European industrial production cost would only partially mitigate against the tariffs.
According to Magna, serial production of GAC's electric SUV AION V is now underway at Magna's Graz facility.
"Europe is a vital market in GAC's global development," said Wei Haigang, President of GAC INTERNATIONAL.
"Partnering with Magna enables us to bring locally assembled electric vehicles to European customers that reflect GAC's values of smart technology, sustainability and craftsmanship."
The AION V debuted in Finland, Poland and Portugal in September.
GAC plans to expand into additional European markets through new partnerships, service and sales networks, according to Magna.
According to our latest CHinese OEM study, in what is becoming a hyper-competitive market environment, manufacturers that have a European market presence of less than 15 years – effectively Chinese brands plus Tesla – are witnessing their collective New Market Entrant (NME) market share reach 10% of the total market in certain months.
During September, the NME share surpassed that due to seasonality tailwinds, while the underlying trend is closer to 8%, adding more question marks to Europe's under-utilised traditional production bases in an already constrained market environment.
On a year-to-date basis over the past 9 months, NMEs accounted for 7.6% of the region's new car market and achieved a record quarter of 8.9% during Q3, or nearly a quarter of a million units, of which 184,555 were Chinese brand models according to the study's research.
NMEs are on target to achieve just below 1 million (950,000) new units this year or 8% market share with Chinese brands accounting for 700,000.
Full details, data, trends and background information can be found in our industry-leading studies, providing key context and trusted by stakeholders breaching industry divides.
Source: Schmidt Automotive Research
*Western Europe 18 Markets: EU Member States prior to the 2004 enlargement plus EFTA markets Norway, Switzerland, Iceland, plus UK
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