BYD leads the way in Europe and forces its competitors to lower their prices to resist

According to an analysis by the Center for Automotive Research, in Germany, purchasing an electric vehicle today costs €2,200 more than a similar model with a gasoline engine. This is a very big progress since last July, the difference was €2,860. It’s definitely getting closer between these two modes of consumption.

Generous reductions on the price of EVs

Manufacturers are well aware that everything depends on prices. Electric vehicles therefore show average reductions of 18.4%, more than plug-in hybrids with 18.2% and gasoline or diesel models at 17.9%. This is a first for electric vehicles. Never before have these models benefited from such generous discounts on the automobile market.

Obviously, if the European automotive landscape is changing so much, it is no coincidence. The Chinese strategy is very aggressive in terms of pricing, notably led by BYD. The manufacturer has simply redistributed the cards with slashed prices for models equipped with solid technologies.

According to the Center for Automotive Research, BYD is therefore the main driver of this price revolt.

BYD leads the way in Europe

BYD relies on very competitive production costs which allow it to generate margins envied by the automobile industry. The Chinese manufacturer is also very independent since it manufactures its lithium-iron-phosphate batteries itself. In short, the company fully manages its supply chain, which consolidates its base to expand throughout the world, particularly in Europe.

Thanks to this commercial pressure, European manufacturers are not giving in and are also reviewing their price scales. The goal is to be attractive to consumers who have plenty of choice and find themselves faced with powerful and less expensive Chinese vehicles.

Consumers benefit from more choice with these price reductions but for manufacturers, the profitability of many models is weakened by all these reductions. Chinese companies have very strong leverage which completely redefines the balance of the automobile industry in Europe. So when will we see a commensurate response from European firms?

Among the responses, Renault has just unveiled its electric Twingo for a price of less than €20,000, like the BYD Dolphin that the editorial staff Digital took charge. We are also talking about the Dacia Hipster as a counterattack, a model priced at less than €15,000, even stronger.