In March, the UK car market saw a surprise leader: the Jaecoo 7, a crossover SUV made by China's Chery, sold 10,064 units to top the monthly sales chart. The vehicle, priced from around £30,000, has been dubbed the 'Temu Range Rover' for its low-cost, feature-packed design.
Chery, partly state-owned, has been China's largest car exporter for 23 years. Its aggressive push into Europe includes the Omoda, Lepas, and Chery brands. The Jaecoo 7 benefits from a brutal price war in China, where overcapacity drives manufacturers to seek profits abroad.
Cost analysis by consultancy Oliver Wyman shows a plug-in hybrid Jaecoo 7 costs Chery about $25,000 to make, compared to $33,000 for a comparable European SUV. Labour costs are four times higher in Europe, and materials costs are 40% higher, giving Chery a significant edge.
Chery's scale allows it to share platforms and parts across brands, reducing complexity. Additionally, Chinese government subsidies apply across the supply chain, from toolmakers to factory construction, far exceeding European support.
Quality has also improved. Steve Young, managing director of an Omoda and Jaecoo dealer, noted that cars at the Beijing auto show were of comparable quality to European models, with no flimsy fittings. Oliver Lowe, head of product at Omoda and Jaecoo UK, said the Jaecoo 7 'feels like a steal' for its price.
The Jaecoo 7's success signals China's growing dominance in the global car market, with potential consequences for European rivals. Chery aims to blend Tesla's innovation with Toyota's scale, and its UK sales suggest it is on track.
