Chinese electric cars are capturing an increasing market share in Europe. Chinese car brands, including plug-in hybrids, account for almost 11 percent of electric car sales in Europe.
In Sweden, Chinese electric cars took a more modest share of new sales during the first seven months of the year, 5.6 percent, including plug-in hybrids.
The explanation is that Chinese car manufacturers are not - as in the rest of Europe - able to offset high import duties in Sweden by investing in plug-in hybrids, according to Tomas Ernberg, CEO of the Chinese car brand MG in Sweden.
A couple of years ago, the EU imposed punitive tariffs on Chinese electric cars to curb what the EU sees as illegal state subsidies from China.
The result was that import duties on electric cars could reach up to 45 percent.
Therefore, Chinese electric car manufacturers quickly shifted focus to exporting plug-in hybrids, where tariffs are around a more lenient 10 percent.
Tax deterrent
However, the best-selling hybrid car in Europe has not even been introduced in Sweden, according to Tomas Ernberg.
Here, the hybrid is subject to an annual tax of around 5,000 SEK, while the tax for an electric car is usually around 360 SEK.
To capture more of the market in Sweden, MG, for example, has launched electric cars where the company, despite import duties, has managed to negotiate a good price, says Ernberg.
Since the US imposed 100 percent tariffs on electric cars manufactured in China two years ago, more Chinese car brands also want to invest more wholeheartedly in Europe and locate their production on European soil.
MG is starting up a factory in Spain by 2028, the Chinese electric car brand BYD is building a factory in Hungary that will be completed this year, and Geely will start production in Barcelona in 2028.
Risk of braking
However, electric cars are on the rise in Sweden, provided that policy instruments such as better charging opportunities at apartment buildings are in place, according to Sofia Linder, chief economist at Mobility Sweden.
Before the summer, however, a government investigation proposed that the discount on the benefit value of company cars should be phased out.
Since corporate customers account for six out of ten new electric cars, the proposal, if implemented, would be a death blow to electrification, says Linder.
July figures from Mobility Sweden show a continued upturn in the Swedish electric car market. During the month, the number of registrations rose by 29 percent.
So far this year, the share of electric cars in the Swedish car market totals 42 percent, compared with 35 percent during the same period last year.
If you count only rechargeable cars (electric and plug-in hybrids), China's market share in Sweden will increase slightly this year, from 4.0 percent to 5.6 percent.
When it comes to electric cars alone, excluding plug-in hybrids, China's market share in Sweden is decreasing so far this year, from 5.0 percent for January to July 2025 to 4.4 percent during the first seven months of this year.
In Mobility Sweden's figures, Volvo and Polestar are not included in Chinese car brands, even though the Geely group owns large parts of the companies.
Source: Mobility Sweden
