Chinese brands become cool in Europe

As Europe braces for another summer of extreme heat, Dong Yunjun has already witnessed a telling sign of changing consumer habits.

Looking out from his office in Stuttgart, Germany, the head of the Midea Europe Research Center's residential air conditioning team spotted several portable air conditioners hanging outside the windows of a nearby building.

"It was the moment we knew our products had succeeded," Dong said. "And we expect a very good season this year."

The product he saw was called PortaSplit, co-designed by Chinese and European engineers. Weighing 10 kilograms, its outdoor unit can be mounted on a bracket outside a window without drilling. The entire process can be completed without professional installation.

The product's first edition was launched in the summer of 2024, with the aim of solving the hassle of installing air conditioners in Germany and many other European countries, where summer temperatures were once milder and many homes are not equipped with air conditioning.

As extreme heat continues to spread and break records due to climate change — with Paris and London hitting record-high May temperatures last month — more Europeans are looking for cooling solutions.

This year, Midea launched an even smaller version called PortaSplit Cool.

"After the product launched, searches for 'Midea' on Google increased 20-fold in Germany," said Dong, adding that it also began selling in Denmark, France, Italy, and the Netherlands.

"Our strategy in Europe now is to make breakthroughs through innovation, instead of low prices," he said. "Because our brand won't be remembered if we only follow others."

The portable air conditioning unit was just one of many home appliances from Chinese brands that have been gaining popularity across Europe, appreciated not only for their value but for their quality and innovation.

A clear sign of this trend was visible at the 2025 Internationale Funkausstellung Berlin, or IFA, Europe's largest consumer electronics exhibition.

Major Chinese brands displayed prominent advertisements, booked some of the largest exhibit spaces, and showcased a range of innovative products, including AI-powered smart home appliances, new-generation displays and robotics.

Some 700 Chinese companies participated, accounting for more than 30 percent of all exhibitors. Observers noted that the IFA has become a key platform for Chinese companies looking to strengthen their presence in Europe and expand international cooperation.

"In the past, most Chinese consumer electronics companies entered international markets as original equipment manufacturers or by offering cost-effective products," said Zhu Keli, director of the China Institute of New Economy. "But now they mainly focus on innovation."

At the trade show's highly anticipated Global Product Technology Innovation Awards, Chinese brands, including Midea, Hisense and TCL, received gold awards alongside companies such as Bosch and Siemens.

Continuous evolution

Oliver Pearce, the London-based executive director of iMpact, a consultancy dedicated to helping Chinese enterprises explore overseas markets, described this latest wave of Chinese companies going global as a continuation of a trend that began in the 1990s.

With the trend in the 1990s seeing Chinese companies building roads and dams abroad and acting as original equipment manufacturers for foreign brands, they were less visible before the 2010s.

Pearce recalled that when he moved to China in 2009, his Chinese friends liked to show off their Samsung or Siemens appliances.

"The average middle-class family in Beijing and Shanghai back then still preferred to buy foreign brands because they believed they were better," Pearce said.

Chinese brands have evolved over the past decade. While still exporting functional, low-cost products in the 2010s, they worked to upgrade their products. Once they had better innovations, they focused on overseas markets.

"They've learned from the Chinese market and are now capable of exporting products that truly reflect domestic innovations that resonate with international consumers," Pearce said.

Similar to the big multinationals that built factories and R&D centers in China during the past two decades, many Chinese brands are doing the same in Europe, innovating for local customers.

"Europe is quite diverse. That's something we always have to tell our headquarters," said Manuel Seethaler, head of public relations and strategy for Midea Europe Research Center's residential air conditioning team. "There is no one-size-fits-all solution for European markets."

In-depth research

The portable air conditioner is the result of in-depth local research, including home visits and surveys, leading to rapid iterative prototyping. Combining German engineering from the Stuttgart R&D center with Italian design from Midea's Milan design center, it is a prime example of the "local for local" strategy.

"In China, it is common for households to have split AC units. That is also true for southern Europe, but in central or western Europe, it's not so common, because the summers are shorter and don't get that hot," Seethaler said.

"As the summer season gets hotter, people start to care about air conditioning, but the installation is expensive. In Germany, the installation fee for a single split AC costs roughly 1,500 euros ($1,730)," he said.

"Another problem is that you're not always allowed to install the outdoor unit and have to acquire permission. That's where we come into play … We are always looking to dedicate products for a dedicated region, where we can solve users' pain points."

Last year, Time magazine named the PortaSplit one of the 300 best inventions in its 2025 list, highlighting innovations that make the world better.

"A portable air conditioner for a warming Europe … making ACs no longer a 'crazy concept' across the Atlantic," it said.

The portable air conditioner was just one of many home appliances that Midea's Europe Research Center has worked on.

Founded in 2019, the center hires experts from across Europe to develop and test products, including washing machines, ovens, coffee makers, and refrigerators, tailored to local user habits and preferences.

Innovation is never a one-person job; it comes from collaboration and constant learning, Chinese and European engineers agree.

Stefan Bross is among the engineers from more than a dozen countries who work at the Stuttgart center. With expertise in environmental engineering, he is working on a new type of heat pump that does not require an outer unit, a feature that is especially well-suited to European townhouses.

"You won't have any restrictions with noise or complaints from the neighbors. This feature is essential in narrow housing situations where neighbors and sound are an issue in the European market," Bross said.

The product he has been working on, H-Pack, billed as a smart, affordable heat pump solution, has undergone extensive testing and will soon launch to market.

In his daily work, Bross frequently communicates with his Chinese colleagues, which enables an efficient, rapid prototyping cycle.

"We send our requests back to the team in China. They implement the changes, and we quickly get new prototypes, test them, and share our feedback on what can be improved for the next iteration. We then soon receive the updated prototype," he said.

"This is a big difference to traditional German companies, in which the process is often slower."

Lewis Fu, president of Midea International, said, "As China-Europe relations continue to grow, we are also planning our journey in the European market."

Through mergers and acquisitions over the years, the group's subsidiaries now cover 18 countries, with R&D centers and factories in Italy, Portugal, Spain, and Turkiye.

"These innovations and elevations in many areas are a great improvement to our competency in the European market," said Fu. "We are ready to be a significant, relevant player in Europe."

Sharing success

Other Chinese home appliance companies have also increased investment in Europe. Through social responsibility programs, sponsorship of sports events, and sustainability efforts, they are blending in and contributing back to the local society.

The China Chamber of Commerce to the European Union and the Roland Berger consultancy published an annual report on the development of Chinese enterprises in the EU.

Titled "Weathering Challenges, Sharing Success", last year's report shows that half of Chinese companies expanded investment in 2025. Collectively, they have employed more than 260,000 local workers across the EU.

The report found that 47 percent of surveyed companies sourced more than half of their total procurement locally, and 87 percent have already launched or are planning to launch public welfare initiatives in the EU that benefit local communities and natural ecosystems.

For example, Hisense invested 45 million euros ($52 million) in a new factory in Valjevo, Serbia, in 2023, to produce cutting-edge refrigeration appliances, which is expected to create 1,000 jobs over the following three years.

The company has also partnered with every UEFA European Championship soccer tournament since 2016, raising its profile among the continent's huge fan base.

Another brand, Haier, has a European branch and has announced a significant milestone in its decarbonization journey: sourcing 60 percent of its energy from renewables by 2025. It has also set ambitious targets for 2030 on reducing greenhouse gas emissions.

Denis Depoux, global managing director at Roland Berger, said at the report launch ceremony that after a first wave of export-fueled success driven by product superiority, speed and cost advantages, competitors are catching up and that a deeper understanding of European customers' preferences is required.

Depoux urged Chinese companies in Europe to "build local customer insights and match the specific Chinese product superiority features with local customer requirements".

"Local industrial footprint, R&D, and marketing are not enough. Local partnerships and potential cross-border (mergers and acquisitions) will foster more sustainable success," he said.

And many leading companies are already doing just that.

Since 2024, Chinese consumer electronics company TCL has partnered with Denmark's high-end audio equipment producer Bang & Olufsen on a long-term technical and licensing agreement to bring premium audio experiences to select TCL products.

Liu Jiandong, chairman of the China Chamber of Commerce to the EU, said: "For Chinese companies, the European market has grown far beyond its initial role as an export destination. It is increasingly regarded as a source of technological innovation, a touchstone for global brands, and a core region for aligning with international standards."

Looking ahead to the next 50 years, Liu compared China-EU relations to a vessel embarking on a grand voyage.

"EU and Chinese companies will move forward together, using fair and transparent rules as the ballast of economic and trade cooperation," he said. "This will enable the two sides to safeguard the stability and resilience of the global industry and supply chains, and inject greater certainty and stability into the vast ocean of global trade."