EU Chamber Survey: 68% of European Companies Choose to Stay or Expand Operations in China

According to a comprehensive study published on Wednesday by the European Union Chamber of Commerce in China, a substantial majority of European enterprises are actively preserving or expanding their supply chain networks within mainland China to maintain international market competitiveness. The data reveals that approximately 68% of the corporate entities surveyed intend to either sustain or broaden their operational footprint in the country. Conversely, a mere 7% of participants indicated intentions to relocate their production lines internationally or establish alternative industrial bases. This evidence suggests that broad administrative efforts toward economic "de-risking" have largely failed to materialize as a dominant trend among major European corporations.

The findings, compiled from approximately 300 professionals managing Chinese supply strategy between January and February, demonstrate an escalating corporate dependence on China as a premier manufacturing and sourcing hub. Currently, the Chinese industrial sector accounts for approximately 28% of global manufacturing output, navigating sustained regulatory headwinds and tariff enforcement from both the United States and the European Union. While the European Commission evaluates more rigorous inspections regarding foreign trade policies, market strategies continue to favor deep localized engagement. The survey indicates that nearly one-third of regional respondents are actively increasing their localized onshore operations, while 37% have maintained a consistent domestic strategy over the previous two years.

Financial optimization remains a primary driver behind these regional corporate commitments, though the nature of these cost efficiencies has fundamentally evolved. Historically reliant on inexpensive labor pools, Chinese manufacturing infrastructure has aggressively adopted advanced automation to counter localized labor deficits. This technological transition has fundamentally altered the domestic industrial environment, drastically boosting productivity speed while rendering direct human labor expenses less relevant. Additionally, structural factors such as rapid quarterly price renegotiations with component suppliers and targeted state subsidies allow local manufacturers to deliver products to global markets significantly faster and at diminished price points. Consequently, roughly 75% of European firms operating within mainland China reported that their localized production infrastructure delivers superior efficiency compared to their international facilities.

Furthermore, this entrenched manufacturing paradigm is reshaping global logistics operations. International logistics executives observe that Chinese corporations are exerting progressively greater institutional control over global shipping networks during their worldwide expansion. A significant volume of maritime transport logistics—notably across high-growth sectors such as electric vehicle manufacturing, battery production, and consumer electronics—is increasingly negotiated, managed, and financed directly within China. This structural shift occurs predominantly where Chinese supply chains possess greater operational maturity than their destination markets. Because both domestic and multinational competitors are heavily leveraging these highly integrated networks, European business leaders emphasize that integrating directly into Chinese supply frameworks has become an operational necessity to match global benchmarks for production pricing and quality control.