Electric car makers are seeing their competitors grow. This is mostly the case in China, resulting in drastic price cuts. After Tesla, it’s up to Chinese automaker Xpeng to adjust prices downwards.
Why is this important?
Many electric car makers in China expect to sell fewer cars in the first quarter of this year due to increased competition. Car manufacturers are therefore forced to cut prices.In the news : Xpeng announced via Chinese social media platform WeChat that it would lower the prices of some cars on Tuesday.
- Xpeng has cut the price of the P7 sedan, the Chinese automaker’s best-selling electric car, to 209,900 yuan ($31,015). This represents a 12.5% drop from the previous price.
- Tesla’s Chinese rival also slashed the prices of all versions of its P5 sedan and G3i sports cars by 10-13 percent, according to the news agency’s calculations. Reuters.
- “We hope to do the intelligent vehicles more accessible to more people,” said an Xpeng spokesperson Reuters.
The competitive battle
Increased competition : Chinese incumbents fear sales figures will decline with the arrival of more and more electric car manufacturers. Even traditional automakers are focusing on developing sustainable vehicles.
- Before Tesla unpacks its price cuts in Europe and the United States, Musk’s company had already done it in China. The US automaker cut Model 3 and Model Y prices by 6 to 13.5 percent earlier this year.
Price Drops Scare Investors: While these price drops are good news for consumers, they worry investors. These interventions put the profit margins of companies under pressure.
- XPeng (in the form of ADRs on Wall Street) lost over 6% on the day.
- The share price You are here it initially fell about 6% last Friday after the announcement of price cuts in Europe and the United States, but the automaker was finally able to limit its loss to 0.9% at the end of the day on negotiation.
(PC)