The group representing China's auto manufacturers has retracted a pledge to avoid"abnormal pricing" that it had brokered between 16 automakers, including Tesla, breaking off a truce in a brutal price war over electric vehicles.
China's auto market, the world's largest, is on track to reach nearly 25 million vehicles in sales this year with overall growth of about 3 per cent, and the share of EVs and plug-ins is rising fast. Consultancy AlixPartners forecasts this will be the first year made-in-China brands top 50 per cent of their home market.
Consumers had been waiting for bigger discounts before buying, analysts said, while some auto suppliers have been forced to accept payment cuts.On Thursday, at an event in Shanghai, CAAM brokered a series of commitments signed by executives from 16 automakers. The signatories included industry-leaders in battery vehicles Tesla and BYD, EV-focused Chinese brands NIO, Li Auto and Xpeng, as well as Geely.
It appeared in doubt just a day later when Tesla said it was offering a referral payout equal to about US$500 on its Model 3 and Model Y vehicles, including in China. Volkswagen's joint ventures with SAIC and FAW also announced price cuts in China on their ID-series EVs on Friday.
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