Ford and GM Follow Tesla’s Lead by Slashing Prices in China: Report
- Ford and GM are among dozens of carmakers offering deep discounts on cars in China to boost sales.
- Ford is offering $6,000 off the Mustang Mach-E to Chinese buyers, The Wall Street Journal reported.
- Tesla was among the first to slash its prices after China ended its electric vehicle subsidies.
Ford and GM are cutting prices in China to boost sales following the abolition of subsidies for electric vehicles, The Wall Street Journal reported.
The American giants are among a growing list of manufacturers slashing prices to stimulate demand.
BMW Group and Volkswagen have introduced competitive pricing before stricter rules on emissions come into effect in July in China, according to Reuters.
Ford cut the Mustang Mach-E by about $6,000, while GM’s Cadillac CT5 is now about 25% cheaper, per the Journal. Ford sold just 84 cars in China last month, down from some 1,500 in December.
Dongfeng Motor Group, through its joint venture with Peugeot-Citroën, is offering 40% off the C6 sedan that now starts at $18,000.
A BMW dealership in Guangzhou had cut the electric i3 by $12,000 to $51,000. Volkswagen’s joint venture with the Shanghai government trims the cost of its cars by between $2,200 and $7,300.
The price war appears to be heating up as car sales in the first two months of this year fell by almost a fifth compared to last year, per the Journal. In December China scrapped its tax cuts and electric vehicle subsidies that were worth close to $15 billion in 2021.
China started offering the subsidy in 2009 and it’s paid out more than $29 billion in total subsidies and tax breaks to carmakers. It was replaced with a dual credits policy that lets auto manufacturers get credits for reducing its fuel use below a certain threshold.
Tesla was one of the first carmakers to cut prices in the US and Europe as well as China. In January it lowered prices this month on the Model S sedan by $5,000 and its Model X by $10,000.
Ford, GM, BMW, Volkswagen and Dongfeng didn’t immediately respond to Insider’s requests for comment, made outside of typical working hours.