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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Intensifying price competition in China’s electric vehicle (EV) market could ultimately benefit Tesla, according to industry experts.
Citing an interview with Chinese media, Zheng Yongnian, dean of the School of Public Policy at the Chinese University of Hong Kong (Shenzhen), warned that the ongoing “self-destructive” price war among Chinese EV makers resembles “collective suicide,” with no clear winners.
Zheng noted that aggressive discounting aimed at gaining market share is rapidly eroding profitability. “Even the combined profits of China’s top automakers may fall short of a single leading global company,” he said, adding that the strategy of enduring losses to outlast competitors is ultimately unsustainable.
He attributed the excessive competition to herd behavior, where local governments and companies rush to invest in the same sectors—such as EVs—through subsidies, industrial parks, and funding programs, often without independent strategic judgment.
China’s EV market has already faced mounting concerns over weakening profitability amid slowing demand and intensifying discounts. Authorities previously urged major players, including BYD, to restrain price competition.
Meanwhile, Tesla is strengthening its presence in China. The company recently completed regulatory registration in Shanghai for an in-car AI voice assistant service, reportedly leveraging local AI models from companies such as ByteDance and startups like DeepSeek to localize its offerings.
However, Tesla’s rollout of its Full Self-Driving (FSD) software in China remains delayed. The company said it is awaiting full regulatory approval, which it expects to obtain by the third quarter.
알파경제 Kim Jisun Reporter(stockmk2020@alphabiz.co.kr)
