Going cold: Mercedes follows in Tesla’s footsteps and cuts EV prices in China
Mercedes has followed in Tesla’s footsteps and cut the price of its electric vehicle (EV) models in China due to a slowing demand.
The luxury car maker announced late on Tuesday the price of the EQE electric SUV would be cut by 9 per cent while the EQS model would be between 11 and 22 per cent less expensive.
“Mercedes-Benz continually observes and analyses dynamic market developments, including the current positioning of other manufacturers in the luxury segment,” said a company spokesperson.
“Based on that, Mercedes-Benz is repositioning certain EQ models in China.”
According to data from the China Association of Automobile Manufacturers, October recorded the slowest pace of EV growth since April, even though the number of cars sold has jumped 81.7 per cent year-on-year to 714,000.
EV sales in China soared over the summer, going up to 129.2, 117.1 and 104.2 per cent in June, July and August respectively.
But they started to slow down, as the pace of growth decreased to 93.9 per cent in September.
Mercedes is not the first automotive maker to make adjustments in the Chinese market, as Musk’s company announced in October it was cutting down the price of its Model 3 and Model Y vehicles by up to 9 per cent.
Commenting on the news, GlobalData automotive analyst Daniel Clarke told City PM: “China’s economy is under strain at the moment so foreign carmakers are dropping their prices as consumers are looking at cheaper EV options
“Naturally, this can mean consumers considering cheaper domestic brands like BYD, which have grown in prominence in recent years.”
Nonetheless, China remains the world’s largest market for EV sales, with Bloomberg NEF analysts expecting it to grab a 60 per cent of the total share this year.