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Chinese carmaker Chery is betting on continuing strong demand for petrol cars in the UK as it aims to become a major global brand in Europe with a full range of petrol, hybrid and electric vehicles.
Victor Zhang, the UK head of the state-owned automotive group, said the transition to electric cars in Britain will probably be slower than expected due to consumer concerns about infrastructure and cost, underscoring the need for internal combustion engines to establish its brand in the market.
“Most of the new brands coming to the UK will do pure electric vehicles,” Zhang told the Financial Times. “We have the petrol version, hybrid and plug-in hybrid as well as EVs. I think this is a very important part of our strategy.”
The Chinese carmaker launched a mass-market sport utility vehicle Omoda on Friday. Its petrol-powered version will cost about £25,000 in the UK while an all-electric vehicle of the brand will be offered from £33,000 with a seven-year vehicle warranty and eight-year battery warranty to attract buyers to the new brands.
Chery will launch a more premium Jaecoo brand in the coming months and has set up 60 dealerships to sell its vehicles in the UK with ambitious plans to expand its dealer network to 100 by the end of the year.
Zhang said the company, which claims to be China’s largest car exporter, was still exploring other options for another European plant including the UK and Italy.
“You have to be local if you really want to be a good player in the market,” Zhang said. “The UK is quite an open market . . . so I don’t think the Chinese tag or label will stop the British consumers from considering us.”
In addition to the slowing growth in EV sales and rising trade protectionism globally, prospects for the internal combustion engine have improved after the UK government last year delayed a ban on the sale of new diesel and petrol cars from 2030 to 2035.
While larger carmakers such as Toyota and state-owned Chinese groups such as BYD and Chery can afford to place bets in every direction, smaller companies are cutting back on investments in internal combustion technology to focus their resources on pure electric cars.
Chinese EV makers have aggressive global expansion plans but their outlook has been clouded by increased tariffs announced by western countries including the US and the EU.
Executives at Chery have said the impact of the EU tariffs on exports of Chinese EVs will probably be limited since the company plans to start producing cars at a former Nissan plant in Spain.
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