Deeper discounts and special financing tools by automakers such as BYD helped lift sales of electric vehicles in China 10.5% in March from the same month a year earlier, industry data showed on Tuesday.
For the January-March quarter, sales totalled 1.03 million EVs, up 14.7% on year but it was the slowest quarterly growth since the second quarter of 2023, according to data from the China Passenger Car Association.
New energy vehicles (NEV) including all-electric models and plug-in hybrids made up 41.5% of overall passenger car sales in March, which jumped 5.7% to 1.71 million vehicles.
Authorities have joined automakers in trying to convince cautious consumers to buy cars to help jumpstart a sluggish economy. Initiatives include revising car loans to promote auto trade-ins and scrapping government-set minimum down payments for consumers financing new-car purchases.
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The launch of an electric sedan by electronics maker Xiaomi last month gave a jolt to the market and prompted rivals to announce further price cuts and subsidies.
BYD, which ceded the top EV seller title to US peer Tesla in the first quarter, is at the forefront in vying with gasoline-engine vehicles with lower-priced NEVs, notably hybrids.
The local champion, which is targeting 20% sales growth this year, in March lowered starting prices for nine models including four under its premium brand Denza by 4% to as much as 20.5%.
BYD chairman Wang Chuanfu forecast falling profit margins this year as the price war intensifies, but said the automaker would ensure stable profitability by improving sales.
Tesla hiked Model Y prices in China by 5,000 yuan ($691.24) starting April 1. But it also offered a time-limited zero-interest financing scheme aimed at reducing the liquidity burden for buyers of the base variant of a Model 3 with a monthly payment of 4,611 yuan on a three-year loan.
Volkswagen and Nio have also launched auto financing plans with low interest rates to attract buyers.
Tesla exported 26,666 China-made vehicles in March, down 11.8% from the previous month, the association data showed. China’s overall car exports jumped 39% to a record monthly high of 406,000 units in March, quickening from February’s 18%.
- By Reuters with additional editing by Sean O’Meara
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