Huawei, Li Auto join EV price war

Huawei's electric vehicle arm is reportedly offering 5,000 yuan (HK$5,409) to lure buyers of Xiaomi's (1810) SU7 to cancel their bookings and purchase its Luxeed S7 as the battle for market share in China escalates.

According to mainland media, sales staff at Huawei said the subsidy was launched at the end of last month. If a customer has paid a 5,000-yuan deposit for a SU7 unit and switches over to the Luxeed S7, a discount amounting the same amount will be offered.

The Luxeed S7, launched in November, is priced at 249,800 yuan and above, while prices for Xiaomi's SU7 start from 215,900 yuan.

The news came as Xiaomi cofounder and chairman Lei Jun said in a post that the production capability and delivery speed are being enhanced quickly. But if customers can't wait any more, he also recommends other models, such as Luxeed S7, Nio's (9866) ET5, XPeng's (9868) P7.

Li Auto (2015) is hopping on the bandwagon with price cuts for all its models by 30,000 yuan, just days after Tesla trimmed its price tags for its EVs. So far, at least seven EV makers have announced price cuts to compete for Chinese buyers.

Li Auto shares dived 8.3 percent to HK$97.45 yesterday, about 46 percent lower than a peak of HK$182.90 hit on February 28.

That came as National Development and Reform Commission data showed prices for 10 new-energy vehicle models in Shenzhen dipped between 5 and 10 percent this year.

The state planner also predicts excess supply will continue long term and market competition will be "extremely fierce" this year.