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Chery Automobile Co. Ltd., announced a promotion campaign worth of RMB10 billion (US$14.5 million) at weekend. The promotion, effective from March 11 to 31, targets all the lineups under four brands-- Chery, Exeed, Jetour, and Chery New Energy. Vehicles under Chery brand were cut by up to RMB31,000, while pricing of the Jetour was lowered as much as RMB42,888.

Chery’s move came days after Chang'an Automobile Co., Ltd. has unveiled promotion with the same worth. The state-owned company slashed official prices by at least RMB14,000. With a comprehensive discount of RMB40,000, the latest version of CS75 Bluewhale became its most heavily discounted model. Another state-owned automaker FAW Group rolled out RMB100 million RMB worth of subsidies in the Jilin Province throughout the March month. The scope of subsidies covers passenger cars and light trucks and varies depending on the purchase price and vehicle type from RMB5,000 to RMB37,000.

Foreign auto giants also took step in the face of fierce competition in China. Some of Toyota Motor Corp.’s dealers were said to offer buy one, get one free last weekend. Customers who bought bz4x, an all-electric SUV, can get a Vios, a compact sedan also made by Toyota, workers at a 4S store in Shenzhen city confirmed to the National Business Daily, a Chinese financial and economic newspaper. Buyers of Toyota bz4x can enjoy a discount range between RMB50,000 and RMB60,000, the staff told the paper.

Earlier this month, auto manufacturers based in Hubei province in central China launched a new wave of high-profile price war. The local government subsidies along with of discounts from the state-backed Dongfeng Motor Group have trimmed prices of a wide range of cars produced by seven Dongfeng joint ventures down by up to RMB90,000. Dongfeng’s promotion started from March 1 to 31 targets 56 models of gasoline-fueled vehicles and new energy vehicles (NEVs) including battery electric vehicle and plug-in hybrid electric vehicles.

This is an expanding price cuts in the start of the year. On January 6, Tesla slashed price by up to 13% in China, its second promotion through direct cuts in more than two months. The starting price of Model Y and Model 3 sold in China accordingly were down to new low, about 43% and 30% cheaper than those on sale in U.S. Soon after the move, Tesla lowered prices across the U.S. Europe, the Middle East and Africa by as much as 20% on January 12, expanding its price war globally. Seres Group announced to trim prices by RMB 30,000 for two SUV EV models co-developed with Huawei. Xpeng announced to offer a new round of price cuts between RMB20,000to RMB36,000 for three EV models. Nio Inc. was reported to offer massive price cuts up to RMB100,000 for versions of ES6 and ES8 updated in 2022.

BYD Co., China’s largest electric vehicle (EV) company, followed suit in late February, though without official announcement. The Shenzhen-based company has lowered prices of Dynasty Series sold in China for inventory clearance, Shanghai Securities Journal, the state-run national newspaper, learned. According to salesperson at the Dynasty showroom in Beijing, the price of 2021 version of BYD’s flagship Han was dropped by RMB20,000 the 2021 version of another EV model Qin down by RMB15,000, and the store can offer the discount between RMB6,000 to RMB8,000 for purchases of latest version.

More than 30 electric and traditional car makers from BYD, Toyota and Ford Motor Co. as of last Thursday joined in the price war, the National Business Daily estimated last week. The price war is expected to last beyond China’s Labor Day holiday on May 1st, and the performance in the second quarter of the year will decide life or death of the auto manufacturer, insiders of the traditional auto manufacturing told Chinese digital news media outlet Jiemian.

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