A BEST-selling car brand that outsold Dacia and Fiat in 2024 has said its “whole future is at risk” as it fears being “wiped out”.
The firm looks set to be hampered by a major law change coming into force just after it allocated huge investment overseas.
Cupra is rising fast as one of the major players in the UK and European car market.
Originally established as the luxury arm of Seat, it ended up partially absorbing its parent brand and becoming the dominant of the two, while sitting under the VW Group umbrella.
Recent releases like the Leon and Formentor have gone down well with fans, to the extent that the brand outperformed rivals Fiat and Dacia in sales last year.
However, there are seemingly tough times on the horizon for the company as the EU mulls over slapping hefty tariffs on Chinese EVs.
In the last decade, China has emerged as the electric car manufacturing powerhouse of the world, with carmakers in the country heavily supported by state subsidies.
This has allowed Chinese firms to flood the European market with EV models that are noticeably cheaper than their rivals from outside of Asia.
Critics claim this amounts to unfair competition and want import charges imposed, similar to the debate several years ago concerning cheap Chinese steal.
While Cupra is a Spanish brand, it has invested heavily in a factory in the eastern Chinese province of Anhui to make its next-generation electric models.
Under the EU’s plan, the new Tavascan would be hit with a 21.3% tax due to where it was manufactured.
Speaking to Reuters, CEO Wayne Griffiths ruled out increasing showroom prices as that would cost Cupra much of its competitive edge.
As such, it looks likely that the firm will have to absorb that entire cost in its profit margins.
Mr Griffiths said: “It puts the whole financial future of the company at risk.
“The intention was to protect the European car industry but for us, it’s having the opposite effect.
“We need to find a solution.”
And it’s not the only firm to suffer, with several major names outsourcing work to Chinese factories.
Almost everyone from Tesla to Mini could be impacted by the move, which would also hinder brands headquartered in China like BYD and Geely in their efforts to break into the European market.
That likely means higher prices for customers as EV adoption becomes more widespread if firms are to remain profitable.
It comes after five motors you can pick up for under £8,000 while still looking “insanely good”.
