Deadly “China speed”. The Chinese automotive industry is eating its own tail, and the first bankruptcies are on the horizon

Are these the last days of glory for the Chinese automotive industry? The words of President Chery Yin Tongyue may prove this. “China speed”, i.e. the pace imposed by local companies, may paradoxically turn out to be fatal for them. According to his forecasts, out of approximately 100 companies, only a few will survive.

One of the largest automotive concerns in China – Chery – like others, has to struggle with a price war on its home market – admitted Yin Tongyue in an interview with Reuters. This internal tussle becomes more and more brutal, turning into… fratricidal war.

In the coming years, there will be consolidation on the market and a few companies will remain – he predicts.

The company's latest strategy is based on drawing on the experience of other giants. – We call it the double T, or Toyota plus Tesla – he explains Yin Tongyue. This also translates into marketing activities. Previously, it advertised itself as “interesting and cheap”. Now it focuses on “quality and innovation”.

Price war and new taxes are drowning the Chinese automotive industry

Moreover, this is not an isolated voice. Kii president Song Ho-sung expressed a similar tone. In his opinion, the protective umbrella of the Chinese government that has so far covered the industry is shrinking. And faster than initially expected.

What exactly are we talking about? Beijing has imposed a tax on electric cars and plug-in hybrids. This is the result of the party's shift in interest from the automotive industry to artificial intelligence and robotics. The new fiscal burden caused the number of registrations to drop by one fifth in the first quarter of 2026 alone. This, in turn, translates into an even more aggressive fight on the European market through, among others, Chinese companies opening factories on the Old Continent.

Chery Automobile's stable includes brands such as Omoda and Jaecoo. Last year, the company sold 2.8 million cars, which is 8%. growth.

ed. aw

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