European companies operating in China face increasing pressure as China's economic growth slows down and overcapacity issues rise. Profits margins for European firms in China are at an 8-year low, with only 30 reporting higher profits than their global average. The slowing real estate sector and geopolitical tensions have contributed to China's economic downturn. Overcapacity is a major issue, especially in industries like construction, automotive, and engineering. It has led to price drops. Getting paid on time by Chinese clients is also a growing challenge as it became more difficult to enforce contracts versus the prior year.