Automotive News Europe — 2024-04-09
Automotive Industry
Talks are focused on Chery producing vehicles at the plant that Nissan shut down in 2021.
China's Chery Auto is nearing a deal to start making cars in Spain, its first manufacturing site in Europe, the Spanish government and lead negotiator EV Motors said.
The Industry Ministry said in a statement it was confident that an agreement to start production in Barcelona will be formalized in the coming days.
The deal emerged after a Spanish delegation held positive talks with Chery this week in China, said a spokesperson for Barcelona-based EV Motors.
The talks are focused on Chery producing vehicles at the plant that Nissan shut down in 2021, helping to recover part of the 1,600 direct jobs lost as a result.
Chery did not immediately respond to a request for comment.
Catalonia's regional government said on Tuesday, 9 April 2024, that its senior business official will travel to China on Wednesday to meet with Chery executives.
The Industry Ministry declined to say whether Spain had offered any public aid to Chery.
Spain will open two tenders in 2024 for companies to request a total of €1.7 bn in loans and grants for electric vehicle production under the so-called PERTE scheme of incentives that uses EU pandemic relief funds.
Nissan's main Barcelona plant was partially handed over to Spanish electric motorcycle maker Silence and local engineering groups QEV and EV Motors, which planned to turn it into a hub for electric vehicles.
EV Motors acquired full corporate control of the hub in March 2024, and has played a key role in the talks with Chery because it would operate under the hub's umbrella.
EV Motors also plans to produce its pickups and electric vans under its Ebro brand, which could involve potential production and commercial deals with Chery, said one source with knowledge of the matter, without elaborating.
Chery is one of several Chinese automakers bringing lower-cost, mostly electric, vehicles to Europe. It began selling cars in Spain earlier in 2024.
China's BYD is building its first European passenger car plant in Hungary.
Reuters reported in March 2024 that the Italian government was holding talks with Chery as part of efforts to attract another major automaker to the country in addition to the multinational group Stellantis.
Italy's Industry Ministry has no information about Chery's choice of Barcelona for its new plant, a government official said on Tuesday, 9 April 2024.
Chery remains in contact with Italian authorities but has received little feedback, said an industry source who requested anonymity and confirmed talks are progressing with Spain.
The electric car market is grappling with an aggressive price war and trade tensions between China and the European Union, which is investigating whether Chinese EV makers benefit from unfair government subsidies.
Establishing manufacturing capacity in Italy or Spain, where electric car sales are relatively low, would fit Chery's strategy of selling a mix of internal-combustion engine, hybrid and full-electric cars.