A new study by Sinolytics, commissioned by the German Engineering Federation (VDMA), reveals that European companies are increasingly losing ground to Chinese competitors. With Chinese products becoming both better and cheaper, 61% of the surveyed 500 European firms expect their competitive position to worsen within five years, a sharp rise from the current 37%.

Chinese manufacturers are not only improving in quality but are also supported by extensive subsidies, giving them a significant edge. The VDMA urges European policymakers to protect the EU market from these competitive imbalances while adhering to WTO rules. To stay competitive, European firms need to innovate and rethink their product strategies.

VDMA President Karl Haeusgen highlights China's aggressive international expansion driven by high-quality, technologically advanced, and cost-effective products. This trend is further accelerated by declining domestic demand in China, prompting firms to seek new markets. China's expansive free trade policies now benefit 21 countries, offering favorable trade and investment conditions.