The Rise of Chery: Adapting to the European Market
Rapidez and capacidad de adaptación are two foundational pillars fueling Chery’s strategy in Europe. The company has made significant inroads into the Spanish market, showcasing an impressive array of models distributed among three different brands. This rapid advancement underscores how companies can thrive in new landscapes by understanding local consumer demands.
Lilian Xiong, Chery’s Vice President , sheds light on the swift progress of these Chinese brands. In a recent interview with Business Insider, she states, “Necesitamos tres o cuatro años”—or approximately three to four years—to develop a vehicle like the Omoda 9, from concept to production.
Her remarks highlight a critical distinction in adaptability and speed when comparing Chinese and European automotive markets. While Chinese vehicles are gaining ground in Europe, Western brands are losing footholds in China due to a failure to adjust to local tastes.
As we’ve seen during Xiaomi’s unveiling of its innovative interior for the YU7, Xataka has had a front-row seat to the efficiency with which Chinese brands operate. Informal discussions with employees from these companies have revealed that what might take European groups years to implement can be executed in just a few months in China.
In some instances, vehicles arrive in pre-series versions that may not fully meet Spanish consumer expectations. However, adjustments are made swiftly, allowing these cars to hit showrooms with enhanced features like refined suspension and steering systems.
Adaptation is another significant advantage posed by Chinese vehicles. Brands like Chery, with their models Omoda, Jaecoo, and Ebro, are honing their offerings in Europe to align closely with local consumer expectations. According to Xiong, Chery’s Barcelona plant plays a pivotal role, conducting extensive groundwork before launching into new markets.
It’s not just Chery. Brands like Leapmotor is fine-tuning its vehicles in Balocco, the home of Alfa Romeo, ensuring that the cars do not suffer from overly soft suspensions or steering, which is often the case in Chinese models. BYD is following suit by utilizing its facility in Hungary, while XPeng is establishing departments in Germany with similar objectives.
Software has become a central theme in attracting consumers, as the automotive landscape shifts to prioritize software over traditional hardware. Xiong emphasizes this change in the interview, stating, “Antes producir un coche se basaba en el montaje de piezas” (Previously, producing a car was centered on assembling parts). Now, elements like software are of utmost importance in defining a vehicle’s value.
This shift is particularly vital in a market where vehicle prices have surged, making luxury materials less accessible. For instance, stepping inside the Omoda 5 reveals superior camera quality compared to many European competitors, despite a lower price point. Furthermore, the Omoda 9 boasts an impressive array of features—electric, heated, and ventilated seats, integrated speakers in the headrests, and a Sony audio system with 14 speakers—surpassing many rivals in perceived value.
This focus on software rather than hardware—defined as the chassis and body of the vehicle—is not unique to Chery. Experts have cautioned Toyota and other traditional manufacturers that their meticulous approach to car-making has become outdated. While these companies place extreme emphasis on detail, Chinese brands like BYD or Tesla manage to save on numerous components, consequently lowering costs and improving profit margins.
This strategy does not rely on complex engineering but prioritizes visible features, resonating well with a savvy consumer base. The Chery Group has already registered over 11,000 cars in Spain this year, placing it on par with established brands like Opel and inching closer to Ford and Citroën. Remarkably, Omoda launched after 2024 had begun, Jaecoo entered the market in the latter half of the year, and Ebro is still relatively new with just a few months of sales under its belt.
The company has remarkably achieved these figures between January and May, despite having just three models available under its umbrella, indicating a rapid ascension in a highly competitive market. Chery’s growth trajectory illustrates its robust strategy and commitment to innovation and local adaptation .