China’s EV market to see price war due to oversupply

China’s electric vehicle (EV) market is expected to see a fierce price war erupt this year as supply outpaces demand, Reuters reported on Monday, citing a government body.

The government body cited an oversupply of EVs and plug-in hybrids (PHEVs) as a key driver of this price competition, as per the statement.

The National Development and Reform Commission (NDRC) expects a surge in new EV and PHEV models this year, with over 110 hitting the market as part of a total of 150 new car launches.

This significant increase in supply is projected to outpace demand growth, which the NDRC estimates at 2.1 million units for 2024.

The NDRC report highlights recent price cuts by BYD and Denza, with reductions ranging from 7.15 to 9.7 per cent across five models compared to the beginning of the year. Li Auto has also followed suit, lowering prices on four of its models.