Author: Alessio Montanucci
Date: 09-04-2026

In recent years, buying a new car has become more difficult. Price lists have grown much faster than incomes, while the automotive sector is in the midst of a historic transformation involving ecological transition, digitalization, and new geopolitical tensions. But what is really driving this dynamic? And above all: how much is a car worth today in the eyes of European consumers?

These questions are addressed in the thesis “Car pricing in the new competitive environment: between pressure from the East and ecological transition,” which analyzes the automotive market with a specific focus on perceived price and the pricing strategies applied by European and Chinese manufacturers.

The context is characterized by increasing complexity: the European automotive industry is squeezed between increasingly stringent environmental regulations, rising production costs, and demand that is struggling to keep pace. Today’s cars are safer and more technological, but also more expensive. In twenty years, the average price of the best-selling cars has almost doubled, while salaries have grown only marginally.

At the same time, the transition to electric vehicles in Europe is proceeding slowly, hampered by insufficient infrastructure, inconsistent incentives, and a perception that the cost is still too high. The result is a stagnant market, with an increasingly aging car fleet and consumers postponing purchases or switching to used cars.

Chinese manufacturers, above all BYD, are entering this scenario with force. Backed by an integrated supply chain, enormous economies of scale, and a competitive advantage accumulated in the battery and electric sectors, these brands are able to offer technologically advanced cars at extremely competitive prices.

Although the models are sold in Europe at prices almost double those on the Chinese market, they are still attractive, giving traditional European manufacturers a run for their money. Unfortunately, the tariffs introduced by the European Union only serve to cushion the problem rather than provide a structural solution to the competitiveness deficit.

The crux of the analysis: perceived value

The core of the research is the value perceived by the consumer. Through a combination of Conjoint Analysis and Van Westendorp Price Sensitivity Meter, the thesis measures how much consumers are actually willing to pay for a car and how their assessments change based on the brand, features, and (above all) geographical origin of the vehicle.

To obtain the necessary data, an online questionnaire was distributed, which collected 499 responses from the target audience.

Delving deeper into the methods used, Conjoint Analysis made it possible to evaluate preferences regarding the attributes that make up the product offering, thus enabling the creation of more profitable car configurations. The Van Westendorp method was then applied in order to identify a price tolerance range.

The various findings show:

Track A, Mixed cars: A preference for European brand cars, but with an attribute importance of only 15%, ranking fourth in the list of attributes by preference. Price remains in first place.

Traccia B, Auto Cinesi: In merito alle auto cinesi notiamo che sono preferite quelle con alimentazione elettrica, sintomo che riflette il buon rapporto qualità prezzo mostrato da questi brand in questa categoria di vetture.

Per quanto riguarda le auto europee è stata riscontrata un’indifferenza in merito all’alimentazione, invece per quanto riguarda il prezzo, risulta l’attributo con la valutazione più alta tra le tre tracce di conjoint. Se ne deduce che i consumatori percepiscano le auto europee come le più care in relazione a quello che offrono.

Moving on to the analysis carried out using Van Westendorp’s Price Sensitivity technique, two tracks containing two vehicles with extremely similar characteristics (Volkswagen T-Cross and MG ZS) were provided to be evaluated by expressing quantifications regarding the price of the vehicle.

Figure 1 – Example of an evaluation form for Track A

Figure 2 – Example of an evaluation form for Track B

The evidence shows:

In the first track, the brand, model, and origin were not specified. The results showed that, for two vehicles, the average optimal price was approximately 10% higher in the case of the Chinese car (€22,000 vs. €20,000)

Volkswagen T-Cross without brand, model, and countries of production.

Figura 3 – Van Westendorp’s graph for the VW T-Cross shown to respondents without brand, model, or origin. The optimal price point is €20,050.

MG ZS without brand, model, and countries of production

Figura 4 – Van Westendorp’s graph for the MG ZS shown to respondents without brand, model, or origin. The optimal price is point is €22,000.

In the case of the second track, with information about brand model and origin was disclosed in the header of the evaluation form. We note that respondents assigned lower values than those indicated in the first track with regard to Chinese cars, a sign that the brand is perceived as less valuable once it is perceived that the car comes from China. On the other hand, with regard to the European car (Volkswagen T-Cross), we note that there were no noteworthy variations in track two, indicating that the model was already known in track one.

Volkswagen T-Cross with brand, model, and origin

Figura 5 – Van Westendorp’s graph for the VW T-Cross shown to respondents with brand, model, and origin. The optimal price point is €20,050.

MG ZS with brand, model, and origin

Figura 6 – Van Westendorp’s graph for the MG ZS shown to respondents with brand, model, and origin. The optimal price point is €20,050.

The results suggest that Europe can no longer compete solely on historical reputation or perceived quality. A more informed pricing strategy is needed, consistent with the real value recognized by the market, to accompany the range of cars on offer. For Chinese manufacturers, on the other hand, the challenge is the opposite: to consolidate trust and strengthen the brand by leveraging such things as customer service, which is currently lacking.

The message that emerges is clear: in the new global competitive landscape, it is not those who produce at the lowest cost who win, but those who manage to align price, perceived value, and brand strategy. The battle between Europe and China will not only be fought over batteries and software, but also over the ability to offer cars that respond with accuracy to the needs of the majority of the population at the right price-quality ratio.