Shares of Chinese automakers slide on concerns of price war
Shares of Chinese automakers slide on concerns of price war

Shares of Chinese automakers slide on concerns of price war

 

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Chinese automakers are sliding in Hong Kong, with Geely Auto sliding 5.4% as of 9:43 am local time, BYD Company down 5%, Nio, Great Wall Motor and Li Auto down more than 4% and Xpeng Motors down 3.3%. 

In the A-share market, the index tracking the auto sector compiled by Wind Information is sliding 3%, making it the worst-performing sector, compared to 0.4% loss for the benchmark Shanghai Composite Index.

An increasing number of local governments are working together with local automakers to provide car purchase subsidies. For instance, central China’s Hubei province joint hands with Dongfeng Motor to provide up to 90,000 yuan subsidies for new car purchases. According to public information, at least 30 domestic car brands have joined the “price war”, with some providing discounts of more than 100,000 yuan.

Data from the China Passenger Car Association showed that retail sales of passenger cars in the first two months of the year tumbled nearly 20% year over year to 13.9 million units.

In addition, German luxury automaker BMW is said to be offering discount of more than 100,000 yuan for its all-electric model, the i3. For the BMW i3 eDrive35 L, which has an official guide price of 353,900 yuan, the price after discounts is 248,000 yuan, reported local media Cailianshe, citing car dealers.