China to CEE: Where Asian Brands Land

For twenty years, the standard route for a Chinese manufacturer selling into Europe was straightforward. Produce at home, ship to a European port, distribute from a warehouse near the coast. Cost advantage did the rest.

That model has been steadily dismantled. Tariffs, anti-subsidy investigations, supply chain security requirements, and customer expectations around delivery speed have all pushed in the same direction. For a growing number of Asian companies, the question is no longer whether to manufacture in Europe. It is where.

Increasingly, the answer is Central and Eastern Europe.

Key Takeaways

• Germany, Hungary and Poland are the top three destinations for new Chinese investment in Europe, with 21%, 18% and 12% of surveyed Chinese companies planning investment there.
• Central Europe offers full EU market access, available land, labour costs in Poland 40 to 60% below Germany, France or the Netherlands, and established industrial infrastructure.
• Permitting is the hidden timeline risk: about 45 months to build and own versus about 21 months to lease into an already-permitted park.
• Companies that move while land and permitting capacity exist get better locations on better terms.

Where Are Chinese Manufacturers Investing in Europe?

Germany, Hungary, and Poland now sit as the top three destinations for new Chinese investment in Europe. Recent survey data found 21% of Chinese companies planning investment in Germany, 18% in Hungary, and 12% in Poland. Given the relative size of those economies, the Hungarian and Polish figures are striking.

Hungary in particular has captured an outsized share. It took 44% of all Chinese investment in Europe in 2023, concentrated heavily in electric vehicle and battery production. CATL began construction of its largest European factory near Debrecen in 2022. The pattern has continued since: the latest Rhodium Group and MERICS report found Hungary still the top destination in 2025 with €3.9 billion of Chinese investment, although its share of the European total eased to 23% as more investment flowed back to Germany and France.

The sectoral mix is also shifting. This is no longer only about assembly and cost arbitrage. Recent investment focus areas include digitalisation, energy and battery production, and automotive electric mobility, with Chinese investment increasingly stimulating advanced manufacturing adoption across the region. The high automation levels typical of Chinese plants have started functioning as a benchmark for local partners, with knowledge transfer flowing through training programmes and engineering cooperation.

The interest is broad enough that major advisory firms are now running dedicated events on European industrial expansion for Chinese manufacturers, bringing industrial park operators from Germany, Hungary, Poland, and the Czech Republic in front of companies in Shanghai and Guangzhou. Poland’s investment agency PAIH reports that Chinese companies are among the investors it supported in 2025.

Why Central Europe and Not the West

The logic breaks down into four factors, and none of them is purely about cost.

Market access with room to grow. Central Europe delivers full European Union market access, but with land availability and permitting capacity that Western European markets increasingly cannot match. In Germany or the Netherlands, finding a suitable industrial site near key corridors has become genuinely difficult. In Poland, Czechia, Hungary, and Romania, it remains possible to build at scale.

Cost structures that have stabilised. Labour costs in Poland remain 40 to 60% below Germany, France, or the Netherlands. Poland’s minimum wage increased by only 3.0% in 2026, one of the more moderate adjustments across European markets. For companies modelling a fifteen-year facility investment, predictability matters as much as the absolute number.

Deep, expanding talent pools. Poland employs around 650,000 information technology professionals and graduates 15,000 to 20,000 specialists in that field annually. Across the region, decades of automotive and electronics manufacturing have produced a workforce already familiar with high-volume, high-precision production environments.

Established industrial infrastructure. This is the factor most often underestimated. Central Europe is not a frontier market. It has motorway networks, rail connections, port access via the Baltic and Adriatic, and dense supplier ecosystems built up over thirty years of serving Western European manufacturers. A company arriving today plugs into infrastructure that already works.

What Do First-Time European Investors Get Wrong?

Companies entering Europe for the first time tend to underestimate the same three things.

Permitting is not a formality. Site acquisition, zoning, and permitting frequently take longer than construction itself. A build-and-own project can run around 45 months from decision to operation, while leasing into an already-permitted park can run closer to 21 months. Most of that gap sits in the approvals process. Companies working to a launch date set by a product cycle or a customer commitment often discover this too late to recover.

Local rules vary more than expected. European Union membership creates regulatory alignment, not regulatory uniformity. Permitting culture, labour law, environmental requirements, and the practical business of moving a project from signed agreement to broken ground differ meaningfully between Poland, Czechia, Hungary, and Romania. What worked in one market does not transfer cleanly to the next.

Environmental and community considerations carry real weight. Large industrial projects in the region face genuine scrutiny on environmental impact, water use, and local consultation. Projects that treat this as a box-ticking exercise have encountered resistance that delayed or complicated their timelines. Engaging seriously and early is not just good practice, it is faster.

What a Good Landing Looks Like

The companies that establish European operations smoothly tend to follow a similar pattern.

They select a site that is already permitted and serviced, taking the longest lead-time phase off the critical path entirely. They lease the building shell rather than buying land and constructing from scratch, keeping capital directed toward production equipment and tooling. They choose locations inside established industrial parks where road access, utility connections, and supplier networks already exist. And they work with partners who have local teams in the specific market, not just a regional office.

That last point matters more than it sounds. Guidance on site selection and permitting from someone who has done it in that country, under that authority, with those requirements, is the difference between a project that runs to schedule and one that discovers a problem in month fourteen.

See CTP’s Solutions and Client Stories for how this works in practice, or talk to the team about land acquisition. 

The Window Is Open, Not Unlimited

The conditions currently drawing Asian manufacturers to Central Europe are strong, but they are not static. Nearshoring from Western Europe is already driving high absorption of industrial space across the region (see Q4 Warehouse Capacity). Construction pipelines are constrained. Electricity grid capacity is emerging as a real limit on where power-intensive manufacturing can locate at all.

Companies that move while land is available and permitting capacity exist will secure better locations on better terms than those that wait for the decision to become obvious.

Europe is open for Asian manufacturing investment. Central Europe is where it can actually be built.

Planning European manufacturing or distribution operations? Book a call with CTP’s local teams across 12 countries, or get the CTP Playbook for five proven plays on entering a market where you do not have home-field advantage.

Author – CTP Research Team
Last updated  – 16 October 2026