China’s automotive sector is facing a slump, which has resulted in carmakers and dealerships slashing prices to boost sales. This has affected veteran carmakers such as Ford, Volkswagen, and General Motors, who are offering discounts on their vehicles to attract consumers. Even Tesla, which dominates the EV industry in the United States, is facing stiff competition from local Chinese automakers such as BYD.
Legacy automakers have initiated efforts to drive demand by adopting pricing strategies such as aggressive price cuts. Ford is offering a discount of approximately $6,000 on its Mustang Mach-E until the end of April, and Volkswagen has lowered the prices of 20 gas-powered and electric models until the same date, with discounts ranging from approximately $2,200 to $7,300 per vehicle.
See also: Tesla Price Reductions Putting Pressure on EV Competitors
General Motors has rolled out discounts for its combustion-powered vehicle lineup, with several Cadillac dealerships launching temporary discounts of around 25% on the CT5 sedan.
The Chinese auto market is extremely competitive, and automakers are doing what they can to attract the most number of consumers possible. Since implementing incentives for buyers in 2010, China has become the largest market for electric vehicles and plug-in hybrids worldwide.
Despite a 23% increase in sales of these vehicles over the last two months compared to a year earlier, purchases of vehicles with internal combustion engines have seen a decrease of almost 30%, resulting in an overall decline in sales. In this environment, legacy automakers are adopting pricing strategies to remain competitive and drive demand.
