China’s surge in electric and hybrid vehicle production has pushed Spain’s auto industry to the sidelines. Spanish plants now face hard choices as Chinese brands tighten their grip on global and European markets.
Assembly lines in China now churn out a third of the world’s vehicles, leaving Spanish carmakers scrambling to keep up. The International Organization of Motor Vehicle Manufacturers reports that in 2025, China built 34,530,738 vehicles, up 10.4% from the year before. That marks 17 years at the top. Spain’s output fell to 2,274,026 units, a 4.3% drop, pushing it down to ninth place. OICA’s figures cover all types of motor vehicles, so the “one in three” headline includes trucks, buses, and vans, not just passenger cars.
Spain once drew automakers from Detroit, Paris, and Wolfsburg. General Motors, Ford, Peugeot, Citroën, and VW/Seat set up shop from Vigo to Valencia and Barcelona to Zaragoza. Top jobs at these Spanish plants were prized, with billions invested and tens of thousands of jobs on the line. The draw: skilled labor, lower costs than Germany or France, and a government eager for foreign investment.
Since November 2024, Chinese automaker Chery has been assembling vehicles at the former Nissan plant in Barcelona in partnership with Spain's EV Motors, marking the first significant example of Chinese car production on Spanish soil.
The numbers have turned. In 2000, Spain ranked sixth, building three million vehicles. By 2025, it had slipped to ninth, overtaken by China, India, South Korea, Mexico, and Brazil. China’s climb has been relentless, jumping from eighth place and two million vehicles in 2000 to the clear leader today.
Electrification sits at the heart of this shift. Chinese brands, with their electric and hybrid models, have captured nearly all of Europe’s market growth. In the EU, Chinese-made cars sold 419,000 units through August, while Tesla managed 58,000. Spain expects electric and plug-in hybrid sales to hit 20% by the end of 2026, but that still trails the EU average of 32%.
In July–September 2026, Chinese automakers and battery companies announced projects in several Spanish regions totaling over 6 billion euros, with some projects confirmed and others in advanced negotiations. These investments are expected to support factory utilization and local employment, but also increase Spain's dependence on Chinese platforms and technology.
Car demand in Spain hasn’t dried up. Registrations in 2026 are on pace for 1.25 million units, the best since 2019. Yet Spanish factories are turning out fewer cars, and the average vehicle age has crept up to 14.6 years. The network of suppliers and mechanics that once thrived around these plants now faces a shrinking pipeline.
Legacy automakers are scrambling. Ford’s Almussafes plant in Valencia saw production collapse from 343,794 vehicles in 2000 to just 98,591. Ford has brought in China’s Geely, which now owns 34% of the operation, betting that partnership will keep the plant alive. Economía 3 reports that new electric SUV and crossover models are set to launch at Valencia from 2028 as part of this alliance, with Ford holding a 66% stake. The industry mood has shifted: collaboration now trumps direct competition.
Automotive power has always shifted with technology and scale. The Ford T changed manufacturing in 1908. Volkswagen’s Beetle put Germany on the map in 1938. Toyota and other Japanese brands rewrote the rules in the late twentieth century. Now, China’s electric push is setting the pace.
Spain’s slide isn’t about weak demand or local mistakes. The ground has shifted as technology and scale move east. China now shapes the future of electric cars, whether battery-powered or hybrid. American, Japanese, Korean, and European brands still fight for market share, but the center of gravity has moved.
Spain’s auto sector faces a stark choice. The country’s industrial backbone, once built on busy assembly lines, stands at a crossroads. Competing with China’s scale and innovation looks out of reach. For now, partnership is the only path Spanish carmakers can take as electrification redraws the map.
