Carwow boss: Why Chinese EVs have become so popular
China’s share of the UK car market has soared in the last two years to make up more than 10 per cent of imports as Brits embrace an influx of new, cheaper models.
Many of China’s biggest manufacturers, from BYD to Geely, are jostling to become the dominant player in the UK EV segment, setting ambitious sales targets and pumping oodles of cash into TV and online marketing campaigns.
Omoda alone last year said it could sell as many as 10,000 vehicles in the UK within months of its launch in Britain. The EV brand, founded in 2022 by Wuhu-based, state-owned Chery, has also dangled the prospect of setting up an assembly plant in Britain, to keep pace with rapid demand.
The latest data from Auto Trader showed MG’s MG ZS model was the most in demand new electric car in the UK in April. Another of its models, the MG4, ranked fourth.
The speed with which Chinese carmakers have clawed market share in the UK is leaving many European rivals in the dust, as they wrestle with the logistical quandary of overhauling production to electric cars.
Electric vehicles, China and Trump’s tariffs
More than two-thirds of car manufacturers in the UK, including Nissan and Stellantis, have committed to a full transition to electric models, ahead of a looming ban on the sale of new petrol and diesel vehicles in 2030.
It will be a huge challenge amid a backdrop of Chinese competition and questions over the level of private demand.
One man who’s witnessing the rapid evolution in the EV market is Carwow boss John Veichmanis. From his London office, a stone’s throw from Buckingham Palace, the CEO of the online car marketplace tells City AM he’s seen “spectacular” growth in BYD sales in recent months.
“The big changes are really the many Chinese EV manufacturers, particularly MG is really, really popular,” Veichmanis said, adding that the carmaker has become one of Carwow’s top-10 configurations.
How to approach the likes of BYD and MG’s rapid expansion is a contentious issue within the industry. On the one hand, cheaper models mean cheaper prices, a key issue for consumers considering making the switch to EVs.
But it has also put further pressure on traditional automakers, many of which have been cutting jobs and closing manufacturing facilities over the last year as they grapple with a challenging market backdrop.
“Choice is good, competition is good,” Veichmanis says.
“Many of the cars that are built in China are very, very good cars. It’s not that you’re paying a lower price for anything significantly different, or less quality.
“I suppose broadly, I have faith Europe is the home of amazing car manufacturers. They will catch up.”
What could save them? Brand power, argues Veichmanis. “The European manufacturers have pedigree. Buying a car is not just about getting from A to B, it’s an emotional product.
“People think about how they’re seen when they get out of their car, European brands have a massive lead there and some quite amazing heritage.”
“Awareness of many of the new brands is still really low. MG have done a really good job. BYD are making good progress, but it’s still early days.”
Veichmanis’ positive outlook is not shared by everyone in the industry. European brands across the piste are cutting jobs, including the likes of Volkswagen, Stellantis, Porsche and Aston Martin.
President Donald Trump’s liberation day tariffs also mean an additional 25 per cent levy on car imports to the US, a move which has sparked a further downturn in the share price of many carmakers, as well as raising the spectre of dumping of Chinese EVs in Europe.
Trump has suggested he could temporarily exempt the car industry from tariffs, but this won’t remove the challenge, Veichmanis believes.
High-demand premium brands such as Ferrari are already hiking prices, while others may “look to avoid the tariffs altogether by shifting more production to the US,” he added citing the likes of Volvo, Audi, Mercedes-Benz and Hyundai.
Is there enough demand for EVs?
Another key issue for the industry’s green transition is demand. In the UK, the Society of Motor Manufacturers and Traders (SMMT) has complained that private uptick for EVs is not meeting the levels necessary to hit green targets, due in part to their cost and issues such as “range anxiety.”
Veichmanis, however, thinks some of this is being overplayed. “I can say with confidence that a lot of the rhetoric is not reflective of the reality for most users.”
“If your job involves driving up the M6 everyday, then probably a petrol car is a better fit, but for a massive segment of the population, EV is a really good choice.”
Carwow’s boss is keen to stress that the primary issue for the lionshare of skeptical consumers is price, rather than any general dislike for EVs.
“If you look at our data, 40 per cent of people on the site are configuring EVs. So it definitely shows interest, but that starts to diminish when you get to the point of price.”
That’s not to say he doesn’t have sympathy for the car companies. Alongside a challenging backdrop and the cost of transitioning, firms are also under-pressure to meet gradually increasing sales targets for EVs or face fines.
“The transition timescale is aggressive, really aggressive,” Veichmanis says. “Because this is a large capital item for anybody to pay for and I do think it’s quite challenging because they’ve put all the responsibility for that transition onto the manufacturers.”
The government recently announced plans to weaken the so-called ZEV Mandate by baking in “flexibilities” and reducing fines.
It followed the closure of Vauxhall’s Luton plant in late March, a move which put an end to 120 years of the company being based in the town. It is estimated around 1,000 jobs have been put at risk following the decision.
The stakes are high, and there is a distinct possibility that similar such announcements could follow in the coming months.
The digitalisation of the car marketplace
A quick scan of John Veichmanis’s CV suggests surprisingly little history in the world of cars.
The 51-year-old’s experience spans leading roles at luxury fashion group Farfetch, the travel tech firm Expedia and even a short stint as director of Skype. So what brought him to Carwow?
“When you look at the online experience, it’s often very sterile and hygienic,” he tells City AM in an interview in London.
“The thing I love about cars is that we really do put the emotion in. If you look at our content, if you look at what we do in video and written space, there’s a lot of emotion and energy about the category that I think is really missing in the online space.”
Most people can certainly name at least one “petrolhead” acquaintance, or maybe that school kid who could point out any car brand without a second thought.
“I really want to keep amplifying that because it resonates with consumers,” Veichmanis says, adding Carwow’s Youtube channel is the “most popular car review Youtube channel in the world, it’s done more than 1.5bn views, which is more than some TV stations.”
Since stepping into the top job, there’s no doubt the former luxury fashion marketeer has developed his own passion for the auto sector.