Research on the Transformation Path of China's New Energy Vehicle Industry Entering the European Market in the Digital Age

Abstract

The extension of China's new energy vehicles to Europe has gained momentum in recent years; but the tough regulatory environment and the high level of development in the systems of automobile industries in Europe have necessitated the transformation of traditional export patterns. Not much literature has been devoted to examining the necessary strategy adjustments for Chinese new energy vehicles in terms of changes in internationalization modes and competitive dynamics in Europe. This paper is based on theories related to the Eclectic Paradigm of International Production (OLI) and dynamic capabilities, using data from industries, government documents, and case studies at the firm level to investigate the effect of digital transformation on Chinese new energy vehicles' expansion and competitive advantage formation in Europe. The research findings indicate that Chinese new energy vehicles at present depend on battery technology, economies of scale, and their supply chain advantages for expansion in Europe; but traditional export patterns cannot help sustain in the long run. Digital transformation enhances data utilization, software capabilities, and user engagement capabilities, enabling firms to convert manufacturing advantages into digital competitive advantages and to drive their transition from product exports to digital-enabled localized operations. At the same time, European green regulations and data governance requirements further push firms to enhance their digital supply chain management and compliance capabilities