Help is Here for Chinese Automakers Headed for European Market

Chinese battery-electric-vehicle companies came to the IAA Mobility show in Munich in September to lay the groundwork for entering or expanding their presence in European markets. A European veteran of China’s auto industry stands ready to assist them.

“If you are a Chinese brand and want to enter the European market, it is a big challenge,” Daniel Kirchert, co-founder and CEO of NOYO Mobility AG, tells Wards. “We can help you to make a professional market entry to Europe.”

NOYO is based in Switzerland, though Kirchert spoke with Wards from his home in Munich. The startup already has contracts with two Chinese EV manufacturers to be the exclusive importer to Switzerland.

Potential customers can research and purchase the brands through a digital platform that is under development. NOYO also is lining up existing dealerships to sell the Chinese brands. Two qualifications are key: The owner must be “100% convinced about electric cars,” says Kirchert, and “only dealers with very good service.”

Aftersales Service Differentiation

Aftersales service is where Kirchert sees the biggest opportunity for differentiation, not just with earlier Chinese brands who tried to sell in Europe.

“The biggest reason not to buy a Chinese car is aftersales service,” he says. “This is rejection reason number one.”

NOYO’s solution, which is under development, is allowing a customer to schedule service directly with NOYO through its digital platform. For a premium brand, NOYO will offer pickup and delivery, and a loaner car while the car is being repaired. The platform – a digital application – will go live in a few months, says Kirchert.

Galliker Transport AG is NOYO’s logistics partner in Switzerland. Galliker covers more than half of the Swiss market, says Kirchert.

NOYO also is building up a mobile service fleet, which will be able to handle the majority of repairs, he says.

The early Chinese brands entering the European market had a problem with a shortage of replacement parts, Kirchert says. NOYO is taking aim at that problem, too. “We are advising (Chinese) manufacturers to build up parts inventory,” he says. 

NOYO chose to start in Switzerland because it is a smaller market with a high rate of EV adoption and its consumers are open to Chinese brands, says Kirchert. The distribution and service models are scalable, he adds.

‘The Car Europe Needs’

Dongfeng Motors, a state-owned automaker based in Wuhan, China, is a NOYO customer. At IAA, it showcased Dongfeng’s premium Voyah EV brand.

Kirchert was pleased with the reception. “We got good feedback from the media,” he says. “The people were really surprised that a Chinese brand could be such good quality.”

Two more Dongfeng EV brands in different segments will follow. The M-Hero is a high-end, 1,000-hp all-electric vehicle with off-road capabilities. It will launch in early 2024. The Nammi brand will also be introduced to Europe as a volume brand, possibly in late 2024. The small EV compares with the Volkswagen ID. 3, which starts in Europe for around $43,000.

NOYO is aiming for a starting price point of around $22,000 for the Nammi, says Kirchert. And while the Nammi has been compared in China to a similar-sized EV from Wuling, the Nammi will be built to European safety standards, he says.

“This is the car Europe needs,” says Kirchert. “That is why we work with Dongfeng. We believe in building affordable cars for mass electrification.”

The other Chinese brand NOYO has signed is Seres, manufactured by Chongqing Sokon Industrial Group. Its Aito EV, produced in partnership with telecommunications giant Huawei, is “complementary with the Dongfeng brands,” says Kirchert.

Tariffs Won’t Stop Chinese EV Makers

Kirchert comes from a China background. He studied in Nanjing in 1998 and 1999, then went to work for BMW in Munich because it had operations in China.

Kirchert rose to become head of sales and marketing at the BMW Brilliance joint venture in China and also introduced the Infiniti brand to China with Dongfeng.

WA Podcast_21

But the company had funding problems and after some crucial partners withdrew from the venture, Kirchert left Byton in 2020. “For me this Byton experience was very tough,” he says. “It broke my heart.”

It didn’t dim his passion for the Chinese auto industry, however. Kirchert saw Europe as the most obvious market for Chinese brands, given the political tension with the U.S., and thought, “Let’s build up a platform for the Chinese brands and be a bridge for them” to enter the European market.

That bridge may require paying a toll, however. The European Commission recently announced it would investigate the “flood” of Chinese vehicles entering the market and consider imposing a tariff to offset unfair Chinese government support.

Kirchert isn’t worried. While imposing such tariffs wouldn’t be wise, he says, “I know for sure many of these Chinese companies have plans if Europe does (levy a tariff) for local production.” 

Rather than turn to tariffs, Europe should do more to foster innovation and try to build up a battery supply chain, says Kirchert.

He is “very confident” that Chinese EV brands will succeed in Europe. EV penetration in Europe could reach up to 70% by 2030, says Kirchert, with Chinese brands taking up to 25% of that market. 

“These Chinese brands, they have time,” he says. “They are there for the long game.”