BMW’s boss has warned that European car makers are forced to compete with Chinese firms on price as the EU moves forward with its plans to ban combustion engine technology.
Oliver Zipse, BMW’s chief executive officer, said that China entering the European markets was an “imminent threat” because of the rapid growth of the electric car market in China over the past 15 years.
He stated that Chinese manufacturers will be able to shield companies like BMW from the competition of foreign competitors, who will focus on cheaper cars.
In an interview with Mr Zipse, he said that the base car segment would either disappear or be ignored by European manufacturers.
This comes after BYD, China’s largest electric carmaker , declared war on Western competitors, calling on automakers to “demolish their competition”.
The European Parliament approved a new law in February that will ban the sale of petrol-powered and diesel-powered cars after 2035. The British Government has announced plans to ban new cars that are powered only by petrol or diesel starting in 2030.
Stocks rose in Asia following a Wall Street report which indicated that the US job market, although still strong, was showing signs of cooling.
This boosted investors’ hopes that Federal Reserve would soon relax its campaign to slow down the U.S. economic growth by raising interest rates.
Tan Boon Heng, of Mizuho Bank, said in a comment that the global markets were primed for a “Nirvana” Fed tightening result. This would imply an “immaculate de-inflation” that did not lead to job losses.
The property market has also been boosted by fresh stimulus measures from China’s regulators. Yeap Jun-Rong, of IG, said that they have lowered mortgage rates and reduced down-payments for first- and second-time buyers.
The Hang Seng Index in Hong Kong jumped by 2.4pc, to 18,828.91. Meanwhile, the Shanghai Composite index rose 1pc, to 3,166.62.
Tokyo stocks closed higher. The benchmark Nikkei 225 added 0.7pc, closing at 32,939.18. Meanwhile, the broader Topix Index closed up 1pc, reaching a new 33-year-high of 2,373.73.
The Kospi in Seoul rose 0.2pc to 2,569.52. Sydney’s S&P/ASX200 rose 0.5pc, to 7,3112.60.
Taiwan and Southeast Asia also saw a rise in shares.
Labor Day is observed today in the United States.