June 4): Chinese carmaker Great Wall Motor Co Ltd plans to shutter its European headquarters in Munich in August and lay off about 100 workers.
The company, one of the largest independent auto manufacturers in China, is adjusting its European strategy as the electric vehicle (EV) market there becomes more challenging, it said in a statement on its website dated May 31. About 100 European staff members will be let go, a company representative said on Monday.
Shares in the automaker’s Hong Kong-listed arm fell as much as 9.4% on Tuesday — the biggest intraday drop since January — on news of the closure and weak May sales of 91,460 vehicles, a 9.5% year-on-year decline.
Great Wall Motor and other Chinese manufacturers are facing threats of higher import tariffs in the European Union (EU), where preliminary results of an anti-subsidy investigation are expected as early as next week. Higher tariffs would reduce the competitiveness of Chinese-made vehicles, likely adding to already-cooling demand for EVs in countries such as Germany and France which are scaling back or restricting subsidies.
The company cited numerous uncertainties in the region as a reason for pulling back. German media first reported the company’s plans last week.
Great Wall Motors last year reportedly sold about 6,300 cars in Europe, accounting for about 2% of its overall exports.
The carmaker’s base operations in China will assume responsibility for providing support to European distributors and continue to explore new markets, the company said.