SHANGHAI: China has ground zero for the price war in electric vehicles (EV), and the battleground is shifting to SUV-styled EVs, the massive segment of the market dominated by
BYD and Tesla Inc.
The analysts and executives said that the market, crowded with more than 90 vehicle models, was about to get even tighter, with at least 20 Chinese models and foreign vehicle brands launched in April, squeezing pricing and margins back home and driving exports.
The analysts said electric vehicle makers in China had followed Tesla’s company’s bold price cuts by lowering prices for their electric SUVs, cannibalising sales of internal combustion engine (ICE) cars as the price gap between the technologies narrows.
The trend would spread abroad with growing exports of China-made electric SUVs.
Tu Le, the founder of Beijing-based advisory industry Sino Auto Insights, said, “We are going to see a lot of Chinese exports due to the ultra-competitive market in China. It is going to be the pressure release valve,”
The SUV market boomed in China over the previous decade and now represents almost 40 per cent of all cars sold, with 400 SUV models of all fuel types.
Almost as several China-made SUVs were sold in 2022 as vehicles of any type in Europe the previous year, and more than 11 million.
The popularity of electric SUVs exploded when Tesla delivered its domestically-produced Model Y almost two years back in China, making it one of the rapidly-growing components in the globe’s largest auto market.
