The expansion of Chinese car brands into Britain is exerting significant pricing pressure on established automakers, prompting deeper discounts across the market, the chief executive of the country’s main automotive industry association said on Thursday.
Mike Hawes, chief executive of the Society of Motor Manufacturers and Traders, told reporters that Chinese entrants have grown rapidly in the UK, taking share with competitively priced electric and plug-in hybrid vehicles. "In terms of the volume, theyre under extraordinary pressure because the Chinese can produce good vehicles at a cheaper cost," he said.
Hawes added that much of the current market discounting is a direct response to that competition. "Theres a lot of discounting going on in the market ... Thats basically to try and compete with a Chinese brand," he said.
Data cited by the trade body show Chinese-owned brands now represent about 15% of new car registrations in the UK, with brands such as SAIC Motors MG, BYD and Cherys JAECOO and OMODA among the leaders in that group.
Hawes pointed out that intensified competition from Chinese models is one of several contributors to the recent contraction in UK vehicle production. British car manufacturing fell 7.5% in the first half of 2026, he said, with trade uncertainty and weaker investment also weighing on output.
Across Europe, manufacturers have been facing similar competitive pressures from Chinese rivals. The chief executives comments came after announcements elsewhere in the region that automakers would pursue deeper cost reductions to remain competitive against lower-cost imports from China.
Hawes noted the different trade responses across jurisdictions. The European Union imposed tariffs on Chinese-built electric vehicles in 2024 after concluding they benefited from state subsidies; Britain, which left the bloc in 2020, has not introduced like-for-like tariffs. Any formal investigation into imports in the UK would require complaints to be lodged by domestic manufacturers, he said, and he was not aware of any such complaints having been made.
Beyond import competition, Hawes listed other structural pressures on the UK automotive sector, including high energy costs, weak investment levels and regulatory burdens. Taken together, he said, these factors are contributing to a challenging environment for domestic vehicle production and for companies that are competing at higher cost levels.
Market context
- Chinese-owned brands now account for about 15% of UK new car registrations, according to SMMT data.
- British vehicle manufacturing contracted by 7.5% in the first half of 2026.
- The EU applied tariffs on Chinese-built electric vehicles in 2024; the UK has not adopted similar measures following its 2020 exit from the bloc.