Net zero ban on petrol cars means EU and UK can't compete with China, BMW chief says

China's largest electric vehicle manufacturer Byd has declared war on Western competitors. Credit: Kentaro Takahashi/Bloomberg

A zero ban on petrol and diesel cars means European automakers risk being wiped out by cheaper Chinese competition, BMW chief warned.

Oliver Zipse said mid-market makers in the UK and the EU will not be able to compete with them. Chinese rivals on price when it comes to electric vehicles.

Mr Zipse told the Financial Times: “The base car market segment will either disappear or be left behind by European manufacturers. I want to send a signal: I see this as an unavoidable risk.”

Chinese manufacturers can produce electric vehicles at a much lower cost than European competitors, as the country started to build a lithium battery industry much earlier than competitors.

The average price of an electric car in China was less than 32,000 euros (pounds sterling). According to a study by Jato Dynamics, last year the price was 27,300 euros, compared to 56,000 euros in Europe, according to a study by Jato Dynamics.

The cheapest Chinese EV, the BYD Seagull, costs under £8,000 for Chinese buyers, while the cheapest European EV is available in the UK, the Fiat 500 is available for £28,195.

Comparison is not perfect as Europe has more strict safety standards.

Price differentials have led to fears that the looming ban on petrol and diesel cars in the EU and the UK will effectively hand over the affordable car market to Chinese manufacturers.

China is home to half of the world's electric vehicles

The sale of new petrol and diesel cars will be banned in the UK from 2030 and in the EU from 2035.

Mr Zipse said his concerns are focused on the cheaper segment of the market and not on manufacturers with more high class. for example BMW. Luxury goods manufacturers can better protect their business through higher margins and higher brand value.

His comments come weeks after China's largest electric car maker called on the country's auto industry to unite and «destroy» competitors.

BYD founder Wang Chuanfu said «it's time for Chinese brands.»

Former Aston Martin CEO Andy Palmer said manufacturers in Europe and the US face «real and real danger» from the rise of Chinese competitors.

Renault and other mass-market manufacturers have admitted they cannot compete with price cuts from competitors including BYD, backed by American billionaire investor Warren Buffett, and Elon Musk's Tesla.

Renault chief engineering officer Gilles Le Borgn told reporters at the International Motor Show in Munich, Germany: “ A good strategy is to maintain prices and adjust fixed costs.”

BMW has poured some of its financial firepower into hydrogen fuel as an alternative to battery-powered vehicles, as the technology is less dependent on lithium and other hard-to-find battery parts.< /p>