Dealers and analysts suggest that competition within China’s market for affordable electric vehicles (EVs) is expected to escalate, driven by consumer demand for good value-for-money options.
With a minimum of a dozen smart electric vehicles priced below 150,000 yuan (US$20,864) -- from BYD to Leapmotor - Consumers have their pick of up to 20,000 yuan in subsidies, making them spoilt for choice. Concurrently, an intense price competition is attracting cost-sensitive shoppers.
The consumption downturn has now affected the automobile sector with customers avoiding costly vehicle options," stated Zhao Zhen, who serves as the sales manager for Shanghai’s Wan Zhuo Auto dealership. "However, major Chinese automakers can produce high-performing electric vehicles priced roughly around half of what Tesla charges for its Model 3 and Model Y.
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Cars powered conventionally as well as those run on batteries within the price range of 100,000 to 150,000 yuan made up one-third of total vehicle sales on the Chinese mainland last year, totaling approximately 7 million units, CPCA statistics reveal.
Among the bestselling models, Xpeng's Mona M03, which starts from 119,800 yuan, has been siphoning off sales of Tesla's Model 3 ranging from 235,500 yuan to 339,500 yuan.
Xpeng from Guangzhou asserts that the fully electric midsize sedan is the world’s first smart electric vehicle under $20,000 to feature semi-autonomous driving capabilities. When activated, this system enables the car to autonomously maneuver through city roads; however, drivers must remain completely attentive and hold onto the steering wheel throughout the journey.
Geely is providing discounts as high as 18 percent on the Galaxy Starship 7compact hybrid SUV, which ranges in price from 97,800 yuan to 130,800 yuan, aiming to boost sales due to increased competition.
On Saturday, BYD introduced the new Seal 06 electric vehicle. With prices starting at 109,800 yuan, this model offers features such as automatic parking and voice-recognition capabilities, which bolster its competitive position within the market.
Prices for these vehicles in leading cities such as Shanghai can be comparable to what a middle-class earner makes in a year," stated Eric Han, who serves as a senior manager at Suolei, an advisory company based in Shanghai. "Their aim is to make cutting-edge smart car technology accessible to a broader audience.
In April, sales of electric vehicles (EVs) priced between 80,000 yuan and 150,000 yuan reached 163,400 units on the Chinese mainland, marking a rise of 16.2 percent compared to the same period last year, as reported by the CPCA.
The level of competition in this sector has escalated as international brands have sped up their introduction of new models to reclaim market share they had previously lost.
In late April, Nissan presented the N7 EV at the Shanghai auto exhibition. , priced from 119,900 yuan to 149,900 yuan. This vehicle boasts a range of 645 kilometers and secured 17,215 preorders within slightly more than a month after sales commenced.
In continental areas, delivering 10,000 units per month for each model is seen as a crucial indicator of achievement.
Having been swayed by just five or six models, all equipped with cutting-edge digital and automotive technology, I find their pricing reasonable," stated Zeng Wei, a Shanghai resident searching for a vehicle. "I might opt for the one offering the deepest reduction.
Top electric vehicle manufacturers like BYD, which holds the title of being the biggest global EV producer, Geely And in late May, start-up Leapmotor reduced the prices of 70 models by up to 20 percent to maintain their market position, as reported by the 21st Century Business Herald newspaper.
In April, Chinese automakers provided an unprecedented average discount of 16.8 percent on their products, up from 8.3 percent in 2024, according to a research report released by JPMorgan Chase last month.
Nick Lai, who leads auto research for the Asia-Pacific region at JPMorgan, stated that the price reductions could cast a shadow over the firms' profitability since their profit margins are anticipated to decrease even more.
Out of China’s approximately 50 electric vehicle makers, just three are reportedly turning a profit. They include BYD; Li Auto, which isTesla’s nearest competitor in Mainland China; and Seres, the creator behind the Aito-branded smart vehicles.
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