Chinese carmakers piling pressure on UK rivals, auto industry chief says

By Muvija M

LONDON, July 30 (Reuters) - A wave of Chinese entrants into Britain's car market is piling pressure on traditional manufacturers, forcing them to offer deeper discounts to compete with lower-cost imports, the head of the country's main automotive industry body said on Thursday.

Chinese brands have rapidly expanded their presence in Britain in recent years, winning market share with competitively priced electric and plug-in hybrid models and intensifying competition for established automakers.

"In terms of the volume, they're under extraordinary pressure because the Chinese can produce good vehicles at a cheaper cost," the Society of Motor Manufacturers and Traders CEO ​Mike Hawes told reporters at a briefing on Thursday.

"There's a lot of discounting going on in the market ... That's basically to try and compete with a Chinese brand," he said.

Chinese-owned brands now account for about 15% of UK new car registrations, according to SMMT data, led by SAIC Motor's MG, BYD and Chery's JAECOO and OMODA brands.

Hawes said increased competition was one of several factors behind the contraction in British vehicle manufacturing, which fell 7.5% in the first half of 2026 as trade uncertainty and lower investment also weighed on production.

Across Europe, automakers have been grappling with intensifying competition from Chinese rivals. Last week, Germany's Volkswagen said it would deepen cost cuts to remain competitive against Chinese brands.

That was despite the European Union imposing tariffs on Chinese-built electric vehicles in 2024 after concluding they benefited from unfair state subsidies.

Britain, which left the bloc in 2020, has not introduced similar tariffs. Hawes said any investigation into Chinese imports would need to be triggered by complaints from UK manufacturers, adding that, to his knowledge, none had been made.

He said Chinese competition was just one of several pressures facing Britain's automotive industry, highlighting also high energy costs, weak investment and regulation.

(Reporting by Muvija M; Editing by Nick Carey and Rosalba O'Brien)