BYD kicks off EV rebate wave in China

Before the weekend, the managers responsible for the Ocean and Dynasty series announced via the short message service Weibo that they would be offering extensive discounts on affordable models. The already affordable small electric car Seagull from the Ocean series, which is the basis for the European model Dolphin Surf presented last week, will be sold with a discount of 14,000 yuan, or around 1,700 euros, until the end of June. This is remarkable, as the Seagull has a list price of just 69,800 yuan (approx. 8,500 euros) in China. With the special offer price of 55,800 yuan or around 6,800 euros, the discount is therefore around 21 per cent.

In the Dynasty series, the plug-in hybrid Qin Plus DM-i, which is also quite affordable, is currently on offer from 63,800 yuan (around 7,800 euros), with a list price of 79,800 yuan (9,700 euros). Here, too, the discount is just under 21 per cent, but at 16,000 yuan it is slightly greater in absolute terms due to the higher price.

According to an analysis, Deutsche Bank attributes the discount campaign to the rapid growth in stocks at BYD dealers. In the first four months of the year, this had grown by around 150,000 units. “According to our dealer checks, BYD’s inventory at the dealer level is currently three to four months, probably the maximum that dealers can handle,” Deutsche Bank wrote. The discount campaign was not well received on the stock market, with BYD shares traded in both Hong Kong and Shenzhen falling by several per cent.

Regardless of the internal background, the discount campaign by market leader BYD has had an impact on the entire market. Within a very short space of time, the SAIC brand IM Motors and Leapmotor have also announced their own discount campaigns, including for more expensive vehicles than BYD. IM Motors is currently offering the 4.91 metre long LS6 electric SUV from 194,900 yuan (approx. 23,700 euros), 45,000 yuan or almost 5,500 euros below the list price of 239,900 yuan. This corresponds to a discount of almost 19 per cent. As there is also currently a government subsidy for the trade-in of an old vehicle, the end customer price can even fall to 179,900 yuan. And Leapmotor is offering discounts on two EREV models with a range extender. The basic version of the C11 SUV model is available until 8 June for 103,800 yuan instead of 148,800 yuan (around 12,600 euros instead of 18,100 euros), more than 30 per cent below the regular price. And for the larger SUV model C16, the EREV is currently being sold 28 per cent below the list price, i.e. for 111,800 instead of 155,800 yuan (13,600 instead of 18,900 euros).

A short time later, Geely Galaxy also responded and announced discounts of between eight and 18 per cent. The Geely sub-brand is still offering the Xingyuan small car for 59,800 yuan until the beginning of June, around 13 per cent below the list price of 68,800 yuan. But even duetly larger models, such as the E,8 are still being offered at a discount.

Various analysts believe it is possible that BYD’s discount campaign could lead to increased price competition in the volume segment in China, meaning that other competitors will follow with similar campaigns. In 2023, a price reduction by Tesla triggered a price war in China, which at the time mainly affected mid-range vehicles. Now, considerable discounts are also being granted on small cars, which are already cheaper. German car manufacturers have repeatedly spoken of a ruinous price war in China, in which they do not want to participate in favour of their own margins, even if it costs sales in the short term.

cnevpost.com (BYD), cnevpost.com (Leapmotor und IM Motors), cnevpost.com (Geely Galaxy)