① BYD and Tesla, the two leading companies in the New energy Fund, will successively launch limited-time promotional activities at the end of 2024 for a final push; ② At the beginning of next year, discounts on new vehicles may increase, reigniting a "price war" in the auto market.
To capture the sales heat of the Autos market before the Spring Festival, $BYD COMPANY (01211.HK)$ 、 $Tesla (TSLA.US)$ the two leading New energy Fund companies will successively launch limited-time promotional activities at the end of 2024 to make a final push.
On December 27, BYD announced that from today until January 26, 2025, two models, the second-generation Song Pro DM-i and the Qin PLUS EV Honor Edition, will have promotional activities, starting at a price as low as 0.0998 million yuan. Among them, the starting price of the second-generation Song Pro DM-i, which just completed its listing in September, will be reduced by 0.013 million yuan; the Qin PLUS EV Honor Edition will have a discount of 0.01 million yuan. Both models will have maximum replacement subsidies of 0.024 million yuan and 25,000 yuan respectively, and enjoy rights such as zero down payment and free OTA upgrades. In addition, the Song L DM-i also launched an insurance discount of up to 5,000 yuan on the same day.
According to calculations, the price reductions for the Song Pro DM-i and the Qin PLUS EV Honor Edition are 11.5% and 9.1% respectively, while the Song L DM-i has a maximum reduction of 3.7%.
"BYD made this decision to take advantage of the consumer enthusiasm before the Spring Festival for further volume; secondly, through limited-time discounts, to ensure relative stability in January's market sales. After all, the 'double new' subsidy policy in 2024 will expire at the end of the year, and there may be a policy 'vacuum period' in early next year," an industry insider analyzed.
Tesla, which acted earlier than BYD, launched the "purchase existing cars with a down payment reduction" policy on December 24, offering a down payment reduction of 0.01 million yuan for purchasing Model Y in stock, which can also be combined with a five-year zero-interest financial plan valid until January 31 next year. Previously, Tesla China announced a policy from November 25 to December 31, offering a limited-time payment reduction of 0.01 million yuan for Model Y with immediate delivery, which can also be combined with the five-year zero-interest policy.
Since the beginning of this year, BYD has been at the forefront of the auto "price war." After declaring the slogan "Electric is cheaper than gas" in February, BYD has continuously launched limited-time promotional activities, and its new product pricing is quite competitive. As a winner in the "price war," BYD's sales exceeded 0.5 million vehicles in both October and November, with cumulative sales from January to November reaching 3.757 million vehicles, a year-on-year increase of 40.02%. The head of BYD Automotive Engineering Research Institute, Lian Yubo, revealed publicly on December 13 that BYD's cumulative sales in 2024 are expected to reach 4.25 million vehicles.
Tesla, which joined the year-end "price war," recorded a sales figure of 0.0219 million vehicles, setting a record for the highest weekly sales in the fourth quarter during the first week of December (December 2-8). According to data from the Passenger Vehicle Association, from January to November this year, Tesla's domestic retail sales reached 0.5742 million vehicles, a year-on-year increase of 8.77%, ranking second in China's New Energy Fund market.
Under the leadership of leading companies BYD and Tesla, the auto market may usher in a new wave of discounts, especially with the Spring Festival this year occurring earlier than in previous years.
"The domestic auto market consumption is still mainly driven by pre-Lunar New Year spending, meaning that the timing of the Spring Festival has a significant impact on consumption, particularly noticeable for the month of January," said Cui Dongshu, Secretary General of the China Passenger Car Association. The 2025 Spring Festival falls on January 28, which is 13 days earlier than in 2024. Coupled with maintenance for equipment from enterprises, tax authorities, and vehicle management offices, it will result in some purchases being finalized by the end of 2024.
"Firstly, consumers are overdrawing their spending in advance this year, which will affect the number of new car Orders in January next year; secondly, with the Spring Festival holiday in January, the reduced sale days will not be favorable for new car sales in January and February next year," predicted Li Yanwei, a member of the Expert Committee of the China Automobile Dealers Association. It is expected that at the beginning of next year, discounts for new cars may increase, and the auto market will reignite a 'price war', with a significant impact on the sales of self-owned and joint venture automakers producing mid to low-priced models.
Editor/Rocky