Analysis for informational purposes only. Capital at risk.
A premium SUV offering Range Rover aesthetics for nearly half the price.
Many assumed that deep-rooted brand loyalty would provide a natural buffer against aggressive pricing from untested entrants.
The retail data indicates otherwise.
In under two years, Chinese automaker Chery has captured the second-largest market share in the UK.
In 1Q26, Chery’s brands (Chery/Omoda/Jaecoo) collectively commanded the No. 2 position in the UK auto market with 5.9% market share, ahead of BMW, Kia, Ford and just behind Volkswagen.
In March 2026, its premium Jaecoo 7 SUV officially topped the national monthly sales charts.
Chery achieved this by executing a fast-fashion playbook: delivering the presence and features of an premium vehicle at a disruptive price.
Jaecoo 7: The “Baby Range Rover”
In March 2026, Chery’s Jaecoo 7 premium SUV displaced the Ford Puma at the top of the UK monthly sales charts.
The Jaecoo 7’s appeal is simple: executive presence at an accessible price.
- Informally dubbed “Baby Range Rover” for its bold, boxy design, the Jaecoo 7 starts at ~£29k vs. the £55k+ feel it projects.
- The entry-level model features a 13.2-inch touchscreen, 19-inch rims, a 360-degree camera system, and a panoramic sunroof, with the top trim adding a 14.8-inch display and ventilated seats.
- PHEV with ~56 miles electric range and 0–62 mph in ~8.5s.
- A seven‑year/100,000‑mile warranty—reducing buyer hesitation toward a newer brand.
Chery Auto At a Glance
Chery Auto (9973 HK) is the second largest domestic passenger vehicle maker in China. One thing that sets Chery apart from other Chinese auto maker is its export focus – it is the No. 1 passenger vehicle exporter in China for 22 consecutive years, with overseas sales accounting for about 50% of total revenue.
In the UK, it operates three distinct brands, offering a comprehensive product portfolio targeting different market segments.
- Omoda: Positioned as the design-forward, accessible brand, focusing on stylish, modern crossovers like the Omoda 5.
- Jaecoo: Pitched as the more premium, rugged alternative, delivering high-specification executive SUVs like the Jaecoo 7.
- Chery: The Tiggo SUV lineup focuses on its ‘Super Hybrid’ (CSH) petrol-electric powertrains, targeting buyers who prioritise extended range and fuel economy.
In 2025, it achieved 11% and 35% revenue and profit growth driven by 15% volume growth (33% export volume growth).
Structural Shift
This disruption isn’t just Jaecoo.
Over the past year, market share has shifted away from incumbents (VW, BMW, Kia, Ford) toward Chinese OEMs such as BYD, Jaecoo (Chery) and Omoda (Chery), Leapmotor, and Geely.
What we’re seeing is a structural trend driven by several factors.
Vertical Integration and Cost Advantage
Chinese entrants leverage deep vertical integration to compress costs.
While legacy automakers assemble vehicles using a variety of third-party suppliers, Chinse automakers such as BYD and Chery controls their supply chains such as battery to reduce input cost. For example, Chery has development its proprietary “Rhino” battery architecture.
In addition, to lower export bottlenecks, Chery partnered with Wuhu Shipyard to construct and operate its own fleet of cargo vessels.
The result: BYD and Chery were able to achieve superior profitability against major European peers such as Volkswagen and Stellantis while maintaining competitive pricing at the same time.
Financial Engineering and Demand Stimulation
In addition to pricing, Chinese automakers also leverage their strong balance‑sheet to make ownership cheaper:
- Subvented finance packages produce materially lower monthly payments (up to ~25% in some comparisons).
- Generous trade‑in valuations create immediate, cash‑like incentives at point of sale.
These mechanics lower the effective barrier to switching from legacy brands.
Winning Dealer Hearts
Fractured dealer relations among legacy OEMs opened a distribution opportunity for Chinese automakers.
Over the past few years, legacy OEMs, including Ford and Stellantis, attempted to force traditional dealers into low-margin “agency” sales models.
Although these legacy OEMs have later abandoned this model, the damage to dealer relations was already done.
Chinese automakers like Chery captured this opportunity. By offering traditional and profitable franchise terms, Chinese automakers rapidly expanded their distribution network.
In just about 2 years, Chery has rapidly established over 140 sites in the UK across its brands (Omoda/Jaecoo/Chery).
The Petrol Price Catalyst
Recent energy volatility has amplified appetite for PHEVs and BEVs. Faced with higher retail fuel prices, buyers are accelerating the switch to electrified models—precisely where competitively priced Chinese offerings are focused.
This is illustrated by Jaecoo’s strong sales volume in March (12K), which accounted for 63% of its total sale volume in 1Q26.
Tariff Hedges via Localisation
To mitigate trade‑barrier risk, Chinese OEMs are localising manufacturing in Europe:
BYD expanding production in Hungary and Turkey.
Chery creating assembly capacity (e.g., a JV in Barcelona) and increasing local content. It is also seeking partnerships with European car makers to expand its production capacity. For example, it is reportedly exploring local UK assembly via partnership with Nissan regarding the use of its facility in the UK.
This article is a “periodical publication” for information only and is not investment advice or a solicitation to buy or sell securities. This article does not constitute a “personal recommendation” or “investment advice” under UK FCA regulations. Investing in equities involves significant risk. The author holds NO position in the securities mentioned. There is no warranty as to completeness or correctness. Please do your own due diligence or consult a licensed financial adviser. Please read the Full Disclaimer before acting on any information. Images created with the assistance of Gemini AI.