Chinese electric vehicle manufacturers are facing intense competition in their domestic market, leading to a price war. As a result, they are pressuring suppliers to deliver significant cost cuts. BYD, the world’s largest electric vehicle manufacturer, has asked a supplier to reduce its product prices by 10% starting next year. BYD’s executive vice president cited the need for the company to enhance its competitiveness, stating that the competition in the new energy vehicle market is entering a “decisive battle.” Meanwhile, SAIC Maxus Automotive, an arm of Chinese state-owned SAIC, has also sent a letter to its suppliers requesting a 10% cost reduction, citing oversupply in the market. Industry insiders note that annual price negotiations with suppliers are common practice, but the demands may be more aggressive than usual due to the intense competition.
Source: https://www.nytimes.com/2024/11/27/business/byd-china-electric-vehicles.html