Top BYD Exec Says Chinese EV Price War «Not Sustainable» & «Not Healthy»

Last Updated on: 14th June 2025, 05:13 am

The Chinese EV price war has gotten a lot of digital ink lately. And for good reason — Chinese automakers have dramatically cut prices on its EVs in recent weeks, and this is just the latest in many rounds of such price cuts/price wars/price battles that have been a fairly common occurrence over the last few years. The price cuts have slammed Chinese automaker stocks, as everyone can see that they hurt automakers’ bottom lines and may be getting out of hand.

Also, while BYD makes quarterly profits and has some room to cut prices, it seems ever other automaker aside from Tesla is still losing money on its EV business. So, cutting prices just means further losses, not less profit as in the case of BYD and Tesla. (Also, for what it’s worth, Tesla overall would not have been profitable in the first quarter if not for the sale of regulatory credits, so it’s even a question whether the American company’s China business was profitable. It seems it wouldn’t have been, especially with the hyper-competitive pricing in the country.)

BYD Executive Vice President Stella Li just spoke on this matter in London, Bloomberg reports, and she provided some sharp words on the price war. “You have to survive, but this is not healthy,” she said. “It’s not sustainable. This is like very extreme, tough competition.” She then went on to elaborate: “We launch this model today, and two months later our competitors launch a similar model that is bigger but priced 10,000 to 20,000 RMB cheaper.” She sure seems to be implying here that BYD is leading the market (which it is) but the competition is trying to gain ground by artificially offering bigger but cheaper EVs following BYD’s lead. However, many argue that BYD is the one that keeps cutting prices and making others do so just to survive.

BYD continues to grow strongly, dominating the Chinese EV market and seeing about 15% growth in the first 4 months of 2025. However, the company wants to be growing 30% this year, with a sales target of 5.5 million vehicles. “In late May, BYD announced price cuts for up to 22 models, with some models seeing price reductions of over 30 percent,” CnEVPost notes. That’s a dramatic price cut, but if BYD can handle those cuts and still make profits (presuming it can), the company has a right to push out the competition.

That said, Stella Li’s own comments imply that it can no longer keep this up, and as I reported recently, China’s Ministry of Industry and Information Technology (MIIT) just convened automakers and warned them that the price war needed to stop or else the industry would be in a lot of trouble and it and other regulators would have to intervene — whatever that means.

BYD is also looking to fuel its growth via overseas sales. It keeps entering or ramping up vehicle options in South America, other parts of Asia, and Europe. Bloomberg notes that she also said BYD plans to invest $20 billion in European expansion in the next few years. That’s a lot of investment in the world’s second largest EV market in order to try to get a serious foothold there. Will it succeed? Will it create a similar price war in Europe? And how much can BYD sustain these big investments and super low pricing in markets around the world? Or is this just the new norm and BYD simply wants to see pricing stabilize now, able to make profits at these levels but not able to keep dropping prices in order to meet sales targets?