BEIJING – Chinese automakers are shipping cars to Europe through the Red Sea and Suez Canal, nearly two years after the Iran-backed Houthi militia in Yemen started attacking vessels in the critical Middle East transit route.
Other automakers are still shipping cars from Asia by way of a much longer, and expensive, trip around Africa.
In July, at least 14 car-carrier ships travelled from Chinese ports to Europe through the Red Sea and Suez Canal, according to a new analysis by Lloyd’s List Intelligence, a British maritime information service. About the same number made the voyage in June.
The trips have continued even after the Houthis used drones, grenades and gunfire to
sink two other cargo ships early in July.
The militia group says the attacks are in solidarity with Palestinians living through Israel’s war against Hamas in the Gaza Strip.
Most shipping analysts assume that the Chinese government has reached an understanding with Iran or the Houthis not to harm car-carrier ships from China.
It seems that “China has found a way to deal with the Iran-backed Houthi rebels, and they have been told that their ships will not be targeted”, said Mr Daniel Nash, associate director of valuation and analytics at Veson Nautical.
Travelling through the Red Sea and Suez Canal saves 14 to 18 days on each round trip between Asia and Europe, compared with going around Africa.
The savings help
Chinese automakers compete
in Europe with Japanese, South Korean and European automakers, which rely on European and Japanese shipping lines that are not using Red Sea routes.
Most other commercial vessels have been avoiding the Red Sea and Suez Canal since the Houthi militia began sinking or hijacking ships near Yemen in November 2023.
Shipowners in Europe and Asia mostly refuse to allow companies to charter their vessels for such trips. Commercial insurers in London have become wary of insuring such voyages, charging higher rates when they do.
The state-owned SAIC Motor, previously known as the Shanghai Automotive Industry, and BYD did not respond to requests for comment.
In a written reply to questions, China’s Ministry of Foreign Affairs did not mention car-carrier ships, but said that “China has been playing an active role in easing tensions since the situation in the Red Sea escalated, and will continue to contribute to the early restoration of peace and tranquillity in the Red Sea”. NYTIMES
