As European Manufacturers Crumble, Chinese Motorcycle Giants Are Seizing The Continent
While Western policymakers remain fixated on the trade dynamics of electric vehicles and semiconductors, a quiet but brutal conquest is taking place in the two-wheeler sector. According to a new research note from UBS released on November 25, 2025, China’s motorcycle manufacturers are no longer just supplying cheap commuter scooters to developing nations—they are rapidly cannibalizing the premium European market, leaving legacy brands scrambling for survival.
The report, titled “The Rise of Chinese Motorcycles in Europe,” paints a grim picture for the old guard of European manufacturing and a bullish roadmap for China’s emerging heavyweights. The thesis is simple: Chinese brands have moved up the value chain, matching European quality while maintaining a crushing 30% price advantage.
The "Positive Surprise" form the East
UBS analysts Wei Shen and Paul Gong highlight that the speed of this penetration has caught the market off guard. The breakthrough in export sales to major hubs like Italy and Germany since 2022 is described as a "positive surprise," with momentum accelerating throughout 2025.
The bank notes that while some investors fear a slowdown after reaching a 10% market share threshold, the structural shift is just beginning.
"We expect the momentum in Europe to continue, as China brand products are good quality with prices 30% lower than EU/JP brands'. We expect motorcycle exports to contribute 30-40% of revenue and profit to CFMoto and Loncin by 2030."
The European motorcycle market is worth approximately RMB 80 billion (US$11.1 billion), representing a premium hunting ground that is 1.6 times the size of China’s domestic market in value terms.
Legacy Brands Are Hollowing Out
The rise of the Chinese OEMs has coincided perfectly with the capitulation of European competitors. The report points to the stark example of KTM, a premier European brand that was forced into voluntary restructuring in late 2024 to avoid bankruptcy. By mid-2025, KTM had to slash production in Austria and move more operations to Asia just to stay alive.
UBS details the retreat of the incumbents:
"On the supply side, the competitive landscape is improving with the retreat or business relocation of European brands from Europe to ASEAN and India, making room in the market for Chinese brands... Its [KTM's] Europe and US market share fell to 5% in H1 2025 from 10% in 2023, resulting in space for China brands."
This is the classic hollowing out of Western industry: European brands are shifting production to Asia to cut costs, while Asian brands utilize that same supply chain efficiency to undercut the Europeans on their home turf.
The New Heavyweights
UBS identifies two primary beneficiaries of this structural rotation: Zhejiang CFMoto Power and Loncin Motor.
These companies have successfully shed the stigma of "cheap Chinese manufacturing." They are now producing large-displacement (500cc-800cc) leisure motorcycles that compete directly with BMW and Ducati, but at a fraction of the cost.
Regarding Zhejiang CFMoto Power, UBS notes:
"CFMoto aspires to become a global powersports brand... In 2024, it shipped nearly 300,000 motorcycles... It is No.1 in the China leisure motorcycle market. With KTM cooperation, CFMoto models feature youthful and international designs that have superior handling."
The bank has reiterated a Buy rating on CFMoto and raised its price target by nearly 40%.
Similarly, Loncin Motor, widely known for its long-term manufacturing partnership with BMW Motorrad, is leveraging that German engineering know-how to push its own premium brand, VOGE.
"Loncin undertakes production for multiple models [for BMW], including engines and complete vehicles. Leveraging this cooperation to accumulate advanced manufacturing experience... capabilities fully integrated into its high-end VOGE brand."
UBS initiated coverage on Loncin with a Buy rating on November 25, citing that its export margins are significantly accretive—5 to 10 percentage points higher than domestic sales.
Structural Growth vs. Valuation Disconnect
Despite the clear trajectory of market share gains, valuations for these Chinese firms remain suppressed relative to their growth potential. UBS points out that both companies are trading at attractive multiples (11-15x 2026E PE) given their projected earnings CAGR of 18-25%.
The market skepticism revolves around the durability of export growth, but UBS argues this is a fundamental mispricing of a long-term trend.
"Our 2026-28 earnings estimates for both companies are 10% higher than the market's, as we think China motorcycle exports growth is structural, considering improved quality and lower costs."
As European consumers grapple with inflation and economic stagnation, the value proposition of a high-performance bike at a 30% discount is becoming impossible to ignore. The age of European dominance in the two-wheeler sector appears to be drawing to a close, not with a bang, but with a flood of high-quality imports from the East.