The electric vehicle (EV) price war has indeed begun in China, with leading automakers slashing prices to boost sales amid a slowdown in the market. Here are some notable developments:

1. BYD: The Shenzhen-based automaker BYD, backed by Warren Buffett's Berkshire Hathaway, has been actively reducing prices to improve sales. They recently priced the basic edition of their refreshed Yuan Plus SUV at 119,800 yuan (approximately US$16,642), which is 11.8% less than the current version. This move follows a series of price cuts over the past two weeks.

2. Xpeng: Guangzhou-based Xpeng extended a 20,000-yuan discount on its bestselling G6 SUV until the end of the month. The entry-level G6 now carries a price tag of 189,900 yuan, down from 209,900 yuan earlier. Xpeng initially announced that the promotion would end on February 29.

3. Market Context: The demand for EVs in China has faltered due to a lack of confidence in the economic outlook and the end of subsidies (about 12,000 yuan) on EV purchases. BYD's sales in February dropped nearly 40% month-on-month, reaching the lowest level since May 2022. As a result, BYD has cut prices across several models to stay competitive. Other Chinese EV makers, including Li Auto and Nio, have also posted sales declines for the second consecutive month.

The intense price competition is expected to continue as carmakers vie to maintain their market share in the challenging environment. The transition to EVs in China may accelerate further due to this ongoing price war.