Foreign Automakers' Share in China Is Only Set to Dwindle
The picture for foreign automakers in China doesn't get any rosier with new research from consultant AlixPartners showing local brands' dominance will climb to as high as 76% by 2030 as the market share of Japanese, European and US companies dwindles.
And despite persistent competitive pressures, the nation's aggressive car price war is expected to evolve, rather than abate.
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Reeling from Trump rebukes, Europe weighs deeper ties with China
BARCELONA, Spain -- Jilted, betrayed, dumped, or defiant. It's hard to describe the European Union after relentless attacks from its once-dependable ally, the United States. The threat from Donald Trump's second administration against Greenland, its sweeping tariff plans and courtship of Moscow have firmed up some European leaders' vows to reduce their reliance on America. That has not gone unnoticed in another global power. China hopes for a Europe detached from the U.S. and is sensing an opportunity now to divide the West. For the past several years, the EU moved in lockstep with Washington to levy tariffs on Chinese electric vehicles and sanction Chinese officials accused of rights violations. Now, locked in a trade war with Washington that may be prolonged, Beijing sees the 27-nation bloc as a desirable partner in blunting the impact from Trump's tariffs and to maintain its strong global position. But for EU leaders, meeting Thursday in Brussels to discuss China among a host of regional and global issues, managing ties with Beijing is no easy matter. An upcoming summit in China in July to mark 50 years of ties might offer the first hint of new consensus between these two global behemoths. The EU-China economic ties are hefty: bilateral trade is estimated at 2.3 billion euros ($2.7 billion) per day. China is the EU's second largest trading partner in goods, after the United States. Both China and the EU believe it is in their interest to keep their trade ties stable for the sake of the global economy, and they share certain climate goals. Like the U.S., Europe runs a massive trade deficit with China: around 300 billion euros last year. It relies heavily on China for critical minerals, which are also used to make magnets used in cars and appliances. As European companies are seeing declining profitability in China, Brussels is hoping Beijing will follow through on recent pledges, like one announced Thursday by the Ministry of Commerce, to ease restrictions on foreign business ventures. 'While other opened their market, China focused undercutting intellectual property protections, massive subsidies with the aim to dominate global manufacturing and supply chains,' said EU Commission President Ursula von der Leyen at the G7 meeting in Canada. 'This is not market competition – it is distortion with intent." Now, Europe, already fretting over the trade deficit, worries that Trump's tariffs could divert even more Chinese goods to Europe, destabilizing markets across the continent. Such vulnerabilities could strengthen Beijing's negotiating position, said Alicia Garcia-Herrero, a China analyst with the Brussels-based Bruegel think tank. 'China has built so many strategic dependencies that the EU is trapped in an asymmetric relationship,' she said, and Beijing could leverage them to 'get a deal in July" at the summit. Analysts don't expect a grand bargain at the summit, but China will likely demand the EU lift tariffs on Chinese electric vehicles or even reopen the bilateral trade treaty, the Comprehensive Agreement on Investment. Either or both would send a powerful signal to Washington. But China's main goal is ensuring the EU remains an accessible and affluent market for goods that might not reach the U.S. because of Trump's tariff blitzkrieg. Despite a truce in the trade war, Chinese businesses are widening their global reach to be less dependent on the U.S. Regardless of any deal, the summit itself will be the message, said Noah Barkin, an analyst of Europe-China relations at the German Marshall Fund think tank. For the EU, the main goal would be for von der Leyen to meet Chinese President Xi Jinping, he said. Whereas she was 'treated rather shabbily' on a 2023 trip to Beijing, Barkin said the Chinese this time will probably 'roll out the red carpet," keen to see 'pictures of Chinese and European leaders walking through gardens and sending a message of unity.' Sun Chenghao, head of the U.S.-EU program at Tsinghua University's Center for International Security and Strategy, expressed hope 'that the future of China-Europe relations can be more independent on both sides.' 'For Europe, that would mean shaping its China policy based on its own interests, rather than simply taking sides,' Sun told the German Marshall Fund in a podcast. 'And for China, this means building a more independent and nuanced approach to Europe.' 'It is precisely because most European decision-makers realize the necessity of strategic autonomy that they have made it clear that they must strengthen cooperation with China," said Yan Xuetong, dean of the Institute of International Relations at Tsinghua University, to The Paper, a Shanghai-based news site. "Even if China and Europe have differences on the Ukraine issue, there is still room for expanding cooperation in areas beyond the differences.' China's deepening ties with its historic allies in Europe like Hungary and Greece stand alongside fears across the continent about its human rights record, espionage, trade policies, military buildup and support for Russia. European police arrested employees of the Chinese tech giant Huawei during an ongoing bribery investigation in Brussels. Czech intelligence services have claimed Beijing directed cyberattacks on its critical infrastructure. And the EU's criticisms of China's human rights violations remain unabated. Russia's invasion of Ukraine has further disaffected Europe from China. Despite Beijing's claims of neutrality, Europe largely sees China as complicit in, if not covertly supporting Russia's war machine. The EU recently cancelled a high-level economic and trade dialogue with China, due to a lack of progress on trade disputes. It also has moved to restrict Chinese participation in EU medical devices procurement. U.S. Treasury Secretary Scott Bessent has called out Spain for its courtship of China, warning that countries seeking to get closer to China would be 'cutting their own throat' because Chinese factories will be looking to dump goods that they can't ship to the U.S. By decoupling their positions on China, analysts say both Brussels and Washington have weaker hands dealing with Beijing. And that might hurt the U.S., which has vowed to prevail over China and retain its global dominance but, as many believe, needs help from its allies and partners. 'If we could just get Japan and the EU and the U.S. together on any issue, ... we could outweigh the Chinese at the negotiating table,' said Nick Burns, the U.S. ambassador to China in the Biden administration. 'President Trump, I think, because of his inattention to our allies and maybe even worse, his sometimes just acrimonious behaviors towards allies, has given away that leverage.' Joerg Wuttke, former president of the EU Chamber of Commerce in China and now a partner at DGA-Albright Stonebridge Group in Washington, argued that the fundamentals underlining EU-China relations have not changed as long as China does not take genuine steps to open its market and that the EU remains 'geared towards' the U.S., though he described Washington as a 'major backdrop noise.' 'We are not allies. We are trading partners,' Wuttke said of EU and China. 'And, so from my point of view is, what is there to worry for the United States?'
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an hour ago
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Novo Nordisk's $50 Obesity Shot Hits India -- The Drug War Just Got Real
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Aviva to accelerate growth with landmark acquisition of Direct Line
Aviva's £3.7bn acquisition of Direct Line is set to finalise in July 2025 and the combined group is expected to become a major force in the UK's general insurance sector as per GlobalData's analytics. Aviva is willing to take a risk and proceed with the deal ahead of receiving Competition and Markets Authority (CMA) clearance. Aviva is the largest general insurance player in the UK; accounting for 9.7% of GWP in 2023 as per GlobalData's UK Top 25 General Insurance Competitor Analytics. Aviva has a healthy lead over Allianz and AXA; the joint-second-largest players which each control 7.6% of the market. Aviva's position as the leading player will strengthen significantly upon the acquisition of Direct Line, with the combined group potentially almost doubling the joint-second-largest player's market share (14.4%). In particular, the greatest advancements will be in the motor insurance space, where Aviva could end up controlling roughly a fifth of the market (19.6%). It would also command a significant share of the total UK property insurance market (17.3%). Aviva's acquisition of Direct Line is a significant event for the UK general insurance market and it is now approaching its final stages. The proposed acquisition has so far gotten regulatory approvals by both the Financial Conduct Authority (FCA) and the Prudential Regulatory Authority (PRA) and is now pending clearance from the CMA. The finalisation of the deal is expected around 1 July 2025, following a High Court Sanction hearing; given that Aviva has waived CMA clearance. With Aviva expressing confidence that the takeover will go ahead, it is willing to proceed with the acquisition ahead of the CMA's formal decision if the High Court Hearing sanction is favourable. This makes the High Court Sanction hearing a crucial date. Aviva's decision to not wait to receive the CMA's decision signals confidence that it will receive unconditional clearance, while also shows keen interest in expediting the deal. Unlike some jurisdictions, the UK's merger control system is non-suspensory; implying that a transaction can be completed before the CMA gives the green light. However, this is not risk free as remedial measures would need to be taken if the CMA concluded that the scale of the combined group would result in a substantial lessening of competition in the market. If that were the case, the CMA could impose remedies (such as divestitures) to lessen the impact, which could be detrimental to Aviva's reputation. Under the acquisition proposal, Direct Line's brands such as Churchill and Darwin Motor Insurance will all now fall under Aviva's umbrella. In any case, the resulting larger combined group could benefit from operational efficiencies, which may potentially reduce costs for Aviva and may result in more-favourable premium rates for customers. At the same time, having a dominant player in the market may end up reducing the number of major competitors; thereby limiting consumer choice. Meanwhile, the proposed merger has already had repercussions with top executives at Direct Line stepping down from their position and fears arising about potential job losses upon completion of the takeover. "Aviva to accelerate growth with landmark acquisition of Direct Line" was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
