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Great Wall Motors to Close European Headquarters in Munich

Is this just the beginning for Great Wall Motors’ European operations?

Chinese automaker Great Wall Motors (GWM) is planning to close its European headquarters in Munich, impacting around 100 employees. The news was reported by “Manager Magazin,” citing insider sources. Employees and business partners were informed of the decision on Tuesday. This closure will also see the departure of the entire top management team, including Steffen Cost, the commercial director of the European headquarters.

However, this move does not signify a complete withdrawal from Europe. According to “Manager Magazin,” GWM intends to maintain its current markets but will manage operations from China. Expansion into new European markets has been put on hold for the time being.

Currently, GWM offers its electric and plug-in hybrid vehicles in Germany, the United Kingdom, Ireland, Sweden, and Israel. Plans to launch the brand in Austria and Switzerland have now been suspended.

Ambitious Goals Unmet

The partnership with the car dealer group Emil Frey is expected to continue, according to “Manager Magazin.” Emil Frey has been responsible for importing and managing the dealer network. However, the relationship has been strained recently. Moving forward, communication will be directly managed by the headquarters in China. It remains to be seen whether this change will resolve existing tensions.

Founded in 1984, Great Wall Motors is headquartered in Baoding, Hebei Province, China. It became the first private Chinese automaker to go public in 2003. SUVs are sold under the Haval brand. The company is led by Wei Jianjun, known in Europe as Jack Wey. GWM had ambitious plans for Europe, aiming to employ 300 people in Munich by 2023. Yet, the company has fallen short of these goals, with only 6,300 new registrations last year, far below expectations.

Challenges for Other Chinese Automakers

GWM is not alone in facing challenges in the European market. Other Chinese manufacturers are also aiming to capture market share, particularly with electric and hybrid models. They offer a wide range of vehicles at competitive prices, heavily subsidized by the Chinese government, which has prompted an investigation by the EU Commission.

BYD, another Chinese manufacturer, recently docked its own cargo ship, the “BYD Explorer No. 1,” in Bremerhaven with 3,000 brand-new electric cars from China. Initially, there were significant concerns about the influx of these affordable cars, causing unrest in the industry as BYD planned to expand its fleet.

According to the German Federal Motor Transport Authority, BYD sold 183 models in Germany in April, while GWM sold 247 cars. Compared to other Asian brands, these numbers are quite small. Hyundai sold 9,106 cars in the same period, Kia 6,556, Mazda 4,026, Mitsubishi 1,907, Nissan 2,779, and Toyota 7,504 cars.

As the industry grapples with these changes, the future of Chinese automakers in Europe remains uncertain.

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