We block Chinese cars. Will they buy our factories instead?

Europe breathes a sigh of relief. After intense negotiations in Beijing, China and the European Union have reached an arrangement concerning imports of Chinese hybrid vehicles. The expected flow is sharply limited, and a trade war appears to have been avoided for now.

Good news for European car manufacturers, you might think. But I wonder whether we have set something else in motion.

If you can no longer export freely to your most important market, why not produce there instead?

And why spend years building new factories, hiring people and creating a service network when you could acquire an existing European business?

China already has an answer

Take BYD, one of China's largest automotive groups. It is developing manufacturing capacity in Hungary and has shown interest in European production locations. Chery and other Chinese brands have explored partnerships with European manufacturers.

This did not begin with the latest trade negotiations. Chinese producers have been considering European production for years. Import barriers and local-content requirements can make that strategy even more attractive.

It may start with SKD or CKD assembly, using partially or completely knocked-down vehicle kits. Then come more locally sourced components, expanded production and potentially acquisitions. Local assembly does not automatically qualify a vehicle as being of European origin; separate rules apply.

When exporting becomes harder, being locally present becomes more valuable.

Could European SMEs become acquisition targets?

The Netherlands and Belgium have an extraordinary network of specialist industrial companies: machine builders, automotive suppliers, body builders, engineering firms, logistics providers and family businesses. Many have generations of know-how, highly skilled employees and deep customer relationships.

These are precisely the assets a new foreign market entrant would otherwise spend years developing. Why would a Chinese manufacturer not consider a Dutch machine builder or a Belgian bodywork company with an established European service network?

It need not begin with a full takeover. A joint venture, minority stake or strategic partnership could be the first step.

Whether this develops into a widespread wave of SME acquisitions remains uncertain. The economic rationale, however, deserves attention.

Would that necessarily be bad?

Here lies the real debate. European SMEs often need growth capital, access to new markets, scale and solutions to succession challenges. A Chinese investor may bring new customers, production, jobs and international opportunities.

But what happens to entrepreneurship when a family firm becomes part of a global group? Will local managers retain decision-making power? Where will product development take place? What becomes of the culture? Who decides which suppliers are used?

A business can become economically stronger while losing part of its independence. That is not inevitable, but these questions deserve answers before any agreement is signed.

And what are we doing?

We look to Brussels for protection, see China as a threat and discuss tariffs as the answer. Meanwhile our own firms must compete every day.

Are we innovative enough? Commercially sharp enough? Do we give younger generations room to take responsibility? Are we as internationally entrepreneurial as the competition?

Perhaps we should spend less energy asking how to keep Chinese competitors out and more energy building businesses that are distinctive, competitive and attractive in their own right.

The EiWijzer

Perhaps the greatest challenge is not the Chinese car entering Europe, but the Chinese entrepreneur knocking on the door of one of our factories.

Such an investment may be a threat or an opportunity. The difference lies in the conditions, the entrepreneurial mindset and who ultimately sets the direction.

So, if an investor arrives tomorrow with an attractive offer, will you open the door? More importantly: are you strong enough to negotiate your own terms?

AI or Chinese?

We invest heavily in AI to strengthen our competitiveness. Rightly so. But if Chinese companies begin to acquire factories as well as compete with their products, perhaps there is another skill to learn.

Should we train ourselves in AI or in Chinese?

Or perhaps both?

The future cannot be stopped by an import tariff.

Ei Openers · We challenge you to think and act.

Other languages: Nederlands · Polski

Sources: Financial Times, 9 October 2026, regarding EU–China trade discussions; Reuters, September 2026, concerning Chinese interest in European production capacity. A rise in Chinese acquisitions of smaller European firms is a strategic scenario, not an established fact.