Since the beginning of this year, many famous European and American luxury automotive brands have seen their prices plummet. Mercedes-Benz has the largest number of price-cutting models, including Mercedes-Benz EQS, EQA, EQB, EQC new energy vehicles, as well as Mercedes-Benz A-Class and GLA fuel cars. Among them, Mercedes-Benz EQS has the highest price cut of 669K RMB (approx. 92,186 USD). BMW and Audi are not far behind, with new energy models generally seeing bigger reductions.
In the era of new energy vehicles, luxury car brands are suffering from the pain of transition, with a number of manufacturers seeing a decline in sales in China. Taking Mercedes-Benz as an example, its sales in China fell 12% in the first quarter of this year. The poor performance of China as its largest market has also greatly affected Mercedes-Benz’s global performance. In the same quarter, Mercedes-Benz’s revenue fell 4.4% year-on-year, and net profit fell 25% year-on-year.
BMW is in the same boat. The BMW i3 model, with an official guide price of 353,900 RMB (approx. 48,766 USD), is now on sale at a 50% discount. Additionally, the new BMW i5, which was released in January this year, has seen dealers offering discounts ranging from 60K RMB (approx. 8,268 USD).
In May, the topic #Cadillac Only Sells at 130K RMB# (凯迪拉克只卖13万多了) hit the Weibo trendy search list, with views as high as 69.68 million. Several Cadillac dealers announced on social media that the naked price of the CT4 model had been reduced to 130K from 210K RMB (from 28937.18 to 17913.49 USD). These price reductions have been officially interpreted as promotional activities at a dealer level, intended to clear inventory or stimulate sales in the short term. But in reality, this reflects the current competitive situation in the entire automotive market.
Currently, the main camp of luxury car brands still relies on fuel cars, but from the perspective of the conventional fuel car market, the “2024 May National Passenger Vehicle Market Analysis” shows that 4.82 million conventional fuel cars were retailed from January to May, a year-on-year decline of 9%. From the perspective of the new energy vehicle market, the domestic retail penetration rate of new energy vehicles was 47.0% in May, up 14% from the same period last year. While the penetration rate of new energy vehicles among luxury cars was 28.4% last month, the penetration rate of new energy vehicles among mainstream joint venture brands was only 7.5%.
Domestic new energy vehicles have gradually taken advantage of the situation. In recent years, domestic new energy vehicle enterprises have invested a lot of money and resources in technology research and development, and innovation. From the point of view of the domestic retail share in May, the mainstream independent brands of new energy vehicles in May’s retail share occupy a significant advantage, reaching 71%. Data for April also shows that more than 200,000 domestic new energy vehicle sales featured in the top 20 were Chinese brands, except Tesla.
