Why competition is heating up in China's sub-US$20,000 EV segment
Competition in mainland China's budget electric vehicle (EV) segment is likely to intensify as consumers seek value for money, according to dealers and analysts.
With at least a dozen intelligent EVs under 150,000 yuan (US$20,864) – from
BYD to
Leapmotor – qualifying for up to 20,000 yuan in subsidies, consumers are spoiled for choice. At the same time, a fierce price war is pulling in budget-conscious buyers.
'Consumption downgrade has spread to the car market as consumers are increasingly shunning expensive models,' said Zhao Zhen, a sales director at Shanghai-based dealer Wan Zhuo Auto. 'But leading Chinese carmakers are able to churn out high-performance EVs at about half the prices of Tesla's Model 3 and Model Y.'
Conventional and battery-powered cars priced between 100,000 yuan and 150,000 yuan accounted for a third of overall sales, or about 7 million units, on the mainland last year, according to data from the China Passenger Car Association (CPCA).
Xpeng chairman and CEO Xiaopeng He and brand ambassador Ouyang Nana pose for photos with the Mona M03 Max EV at an event in Beijing on May 28. Photo: AP
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South China Morning Post
an hour ago
- South China Morning Post
RedNote joins AI race with its own open-source model that it says bests Alibaba, DeepSeek
Chinese social media platform RedNote has open-sourced its first large language model (LLM), joining a growing list of Big Tech firms looking to stake a claim in the artificial intelligence (AI) market, as the Shanghai-based company tries to leverage its growing international profile for new growth. The company on Friday unveiled its model, a mixture-of-experts system that activates 14 billion parameters out of a total of 142 billion when responding to queries, a design that aims to match the performance of leading AI models while cutting training and inference costs. RedNote said the model was developed by its in-house Humane Intelligence Lab, or 'hi lab', which evolved from the company's previous AI research team. RedNote, known as Xiaohongshu in Chinese, has 300 million monthly active users. Recent market transactions in the privately held company have seen its valuation reach US$26 billion , surpassing its pandemic-era peak in 2021, Bloomberg reported last week. The company is expected to launch an initial public offering as soon as this year. The company opened a new office in Hong Kong on June 7, its first outside mainland China, located at Times Square in Causeway Bay. RedNote has been looking to expand internationally this year after a boost in its popularity overseas when it looked like the US might ban ByteDance 's TikTok China has seen a surge in the number of LLMs released in recent years, with a recent trend towards open-source models following the popularity of models from AI research firm DeepSeek . Deep-pocketed tech giants such as Alibaba Group Holding Tencent Holdings and ByteDance have been leading the charge in training pricey foundational models. Alibaba owns the Post. RedNote's Humane Intelligence Lab has this year been recruiting researchers with strong humanities backgrounds, emphasising the importance of humanlike expression and alignment with human values. The company claimed outperformed other leading open-source models in Chinese language understanding, including Alibaba's Qwen2.5-72B-Instruct and DeepSeek-V3.
South China Morning Post
an hour ago
- South China Morning Post
‘It's tough': 30 Hong Kong workers complain as King Parrot Group debt hits HK$5 million
More than 30 of about 120 employees affected by the sudden closure of nine restaurants operated by a giant Hong Kong catering group have sought help from labour authorities, with a representative saying the debt involved has increased to HK$5 million (US$637,155). The workers have sought help after 33-year-old restaurant chain King Parrot Group closed its nine eateries on Friday. It ran over 20 brands and more than 30 themed restaurants at its peak. The manager of a China House restaurant in Mei Foo, run by the group, was among those who showed up at the Labour Department on Monday. She said the restaurant was among the nine that had been closed. 'We [managers of different restaurants] were called to the office for a meeting in the afternoon during service hours, and were told that restaurants would shut down on the spot,' the manager, surnamed Chan, said. 'It is tough for us proletarians in this economy of ever-shutting-down restaurants, but what can we do? 'You do not earn, then you do not eat; we will still have to pay our rent and everything.'
South China Morning Post
2 hours ago
- South China Morning Post
China's Geely to stop building new car plants amid severe global overcapacity: Li Shufu
Geely Auto , the mainland's second-largest carmaker, will not build new plants amid excess capacity worldwide, a move that is likely to ripple across the sector as most Chinese companies are finding it difficult to make profits. Chairman Li Shufu told the Chongqing Auto Show over the weekend that the company would avoid building excess capacity and instead focus on improving its technological capabilities to become a key player in the future of mobility. 'The global automotive industry is mired in severe overcapacity woes, [so] we have decided to stop building new car plants,' he said in a video clip posted online. His comments came as carmakers were mired in a brutal price war on the mainland. Leading players such as BYD , Geely and start-up Leapmotor slashed prices of 70 models by as much as 20 per cent in the last week of May to retain market share, according to the 21st Century Business Herald newspaper. Geely Auto chairman Li Shufu told the Chongqing Auto Show over the weekend that the company will stop building new car plants. Photo: Handout Chinese carmakers' discounts more than doubled to a record 16.8 per cent in April from 8.3 per cent in 2024, according to a JPMorgan Chase report in May.
