French industry faces growing Chinese competition in the automotive, electrical, metal, chemical and pharmaceutical sectors, according to new analysis from Banque de France.
As the bank found, China’s share of French imports of industrial goods increased from 9.2% in 2017 to 10.7% at the end of 2025 when measured by value. When adjusted for price changes, Banque de France estimates that China’s share increased by approximately five percentage points between 2017 and mid-2025 in volume terms.
‘The fact that Chinese imports are growing faster in volume than in value terms indicates that products imported from China have become relatively cheaper than those from other countries,’ Banque de France noted. ‘When these products compete with French-made goods, this price advantage may lead some buyers to opt for Chinese goods rather than domestic products.
‘This increase in China’s share of imports is not unique to France: it is also apparent across the euro area, although its extent and timing vary from one country to another.’
Direct competition
As part of its analysis, Banque de France examined whether increased Chinese imports represent direct competition for French domestic production.
It found that the aggregate exposure of French industry remains relatively limited because many of the products imported from China are either produced only in small quantities in France or are no longer significantly produced domestically.
Around half of French imports of consumer electronics, telephones and communications equipment, computers, household appliances, sports equipment, games and toys come from China. As these categories are generally not produced at significant scale in France, high Chinese import shares do not necessarily translate into direct competition with French manufacturers.
Exposed sectors
However, the analysis identified five sectors as more directly exposed because they combine significant French production with substantial imports and a meaningful or rapidly growing Chinese share.
The automotive and electrical-equipment sectors are already experiencing stronger Chinese competition. The central bank specifically identified electric vehicles and lithium-ion batteries as areas where Chinese manufacturers have made substantial progress.
‘While French government policies and the tariffs erected by the European Union since mid-2024 are helping to protect the European market, competition remains fierce in export markets and in the manufacture of components,’ it said.
Metal products and chemicals are also under pressure. Banque de France said metal-product manufacturers face rising energy costs and weaker demand from sectors including automotive and construction, while chemical companies face high production costs alongside stronger international competition.
‘In both cases, the growth in Chinese imports is exacerbating existing pressure,’ the bank noted.
Pharmaceuticals are another area of increasing Chinese involvement. Chinese companies have traditionally been active in generic medicines and active pharmaceutical ingredients, but the central bank said their presence is expanding into more innovative areas.
Aerospace is described as a special case. French aerospace production remains strong and well integrated, limiting short-term exposure. However, the analysis notes that China is seeking to develop the capacity to compete across the aerospace value chain over the longer term. Read more here.
