China’s Chery considering factories in Europe and the UK – report

Chinese car-maker Chery could expand its horizons by building factories in mainland Europe and the UK before the end of the decade, with vehicles from the latter potentially being exported to Australia.

In an interview with the Financial Times, the boss of Chery’s UK division – Victor Zhang – told the publication the car-maker is looking to produce its cars in Europe and the UK if demand is high enough from the two markets.

“At this moment, we have car manufacturing in China, but as volume grows in the near future, of course local production is a very important consideration,” Mr Zhang said.

“We are still thinking from the investment point of view, the UK should do a separate plant. The UK itself is big enough, with 2 million market demand [annually].” 

The comments come amid an ongoing probe by the European Union into the low prices of Chinese electric cars in Europe – which it claims are "kept artificially low by huge state subsidies" – and fears tariffs will be placed on Chinese-built vehicles in Europe.

According to the Financial Times, Mr Zhang also suggested the UK factory could one day be capable of exporting cars to other right-hand-drive markets, including Australia.

Chery re-launched in Australia in March 2023, after departing the market eight years earlier due to poor sales, safety ratings and an asbestos recall.

At present, the Chery Omoda 5 and Tiggo 7 Pro SUVs are the brand’s only models on sale in Australian showrooms, though it has announced plans to expand its local line-up.

Despite Chery executives holding high hopes to build factories in Europe and the UK, the brand has not yet launched in the UK – with first deliveries of the Omoda 5, branded as the 'Omoda C5' without Chery badges, due to begin in the coming months.

If Chery establishes itself as a major player in the market before 2030, it would then invest in a factory to serve the region – or at least it claims that is its plan.

All Australian-delivered Chery models are built in China, despite the brand’s subsidiaries producing some examples of the Omoda 5 in Indonesia, Malaysia and Iran.