BAODING, China (Reuters) -China's Great Wall Motor is targeting annual production of 300,000 vehicles by 2029 in Europe where it is scouting locations for its first car plant in a battle to revive flagging regional sales, a company executive said.

GWM teams are weighing up sites for the factory in Spain and Hungary, among other countries, Parker Shi, president of GWM International, told Reuters at the company's headquarters in Baoding in the northern province of Hebei.

He was delivering the first update on privately-owned GWM's ambitions for European production since 2023, when its President Mu Feng said the company had big plans for the region and had begun site selection for a plant.

Reuters is reporting the annual European production target of 300,000 for the first time.

LABOUR, LOGISTICS COSTS AMONG TOP CONCERNS

Labour and logistics costs are among the myriad considerations complicating the choice of location, as GWM will initially need to ship components to the target market for assembly, Shi said this week.

The automaker is also monitoring the European Union's industrial policies, with an eye to changes in the investment climate and custom duties.

"All the business cases need to be workable," said Shi, who has kept an international focus since joining the automaker in 2002. "Otherwise, it will be difficult for us because it's going to be a huge investment for a long term."

Chinese automakers are increasingly looking to expand overseas as a way of escaping a brutal, prolonged price war touched off by domestic overcapacity.

However, their efforts to boost sales in Europe and other major auto markets have met with higher tariffs on electric vehicles, where Chinese brands are most competitive.

In Europe specifically, GWM needs to wrest market share from entrenched incumbents as well as aggressive Chinese rivals such as BYD.

Reuters has reported that BYD considers Spain the top candidate for a third European plant, besides manufacturing facilities in Hungary and Turkey. GWM currently operates overseas plants in Russia, Thailand and Brazil.

'EVERYTHING NEEDS TO SPEED UP'

New car registrations in Europe under GWM's EV brand Ora, which form the bulk of its regional sales, slipped 41% to 3,706 vehicles last year, according to JATO Dynamics, despite record overseas sales totalling 453,141 vehicles.

With the company having set itself a target of 1 million vehicles in overseas sales annually by 2030, Shi said, "That's why we're speeding up the European strategy." He added, "Everything needs to speed up."

Europe still has great potential for Chinese brands across all powertrains, he said, and GWM's planned factory will build vehicles across the spectrum from conventional engines to fully electric.

The company aims to appeal to mainstream consumers in Europe with new models such as a multi-powertrain version of the Ora 5 compact SUV that it plans to launch in mid-2026.

GWM has begun taking pre-orders for the all-electric Ora 5 on its home turf from 109,800 yuan ($15,480). Pricing for the European version has yet to be announced.

($1=7.0948 Chinese yuan renminbi)