Hyper-competition sees new market entrants on track to strip away up to 1 million units from incumbent OEMs according to new study, adding more question marks to under-utilised production plants
- Matthias Schmidt
- 2 hours ago
- 2 min read
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.
The encroaching market share gains from these manufacturers provide the biggest indication yet that the traditional high-barrier-to-entry hurdles are being cleared at an increasingly accelerated pace, which previously acted as a breakwater for incumbent manufacturers and consequently adds more question marks to those already hovering over Europe's underutilised production sites. With approaching one million units set to be delivered across Western Europe from the likes of BYD, Chery and Tesla this year that is effectively three production sites worth of volumes running at maximum capacity becoming stripped out of the market. While some will be retrofitted for other uses such as Renault's recycling Refactory in Flins, others will simply not survive.
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.
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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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