China’s state planner, the National Development and Reform Commission (NDRC), has forecasted an intensification of price wars among electric vehicle (EV) and plug-in hybrid automakers this year due to an oversupply and other factors, according to a statement released on Monday.
The NDRC expects the launch of more than 110 new energy vehicle (NEV) models out of a total of 150 new cars this year, leading to heightened competition in the market. Despite this, the commission estimates market demand for NEVs, including EVs and plug-in hybrids, to reach 2.1 million units in 2024. However, the three top NEV brands—BYD, Aito, and Li Auto—have planned to increase deliveries by 2.3 million units, indicating a potential oversupply situation.
Factors such as falling battery costs and economies of scale are expected to drive price cuts in NEVs, which could range from 5% to 10% in the southern city of Shenzhen, known for its high adoption of EVs, according to the NDRC.
Leading the price reductions, BYD and Denza have already slashed prices by 7.15% to 9.7% on five models in April compared to the beginning of the year, the NDRC reported.
The NDRC’s observations indicate a dynamic and competitive market for NEVs in China, with automakers vying for market share in a rapidly evolving industry landscape.
