Chinese EVs Nio and Xpeng are turning to the mass market for growth

Nio founder and CEO William Li poses outside the New York Stock Exchange to celebrate his company's IPO.

Photo: NYSE

BEIJING – Chinese electric car start-ups Nio And Xpeng are targeting a lower priced segment of the market with plans to launch new branded cars this year.

Nio's first mass-market car will be a cheaper than SUV Tesla's Model Y, CEO William Li told CNBC's Eunice Yoon on Thursday. The Tesla SUV starts at 249,900 yuan ($35,197) in China.

Like many early entrants to China's electric car market, US-listed Nio targeted the premium market when it launched about a decade ago. The vehicles can cost around $50,000 or more and offer buyers additional services such as Nio clubhouses and a network of battery charging and swapping stations.

Nio and Xpeng's plans to launch mass-market brands put the companies in more direct competition with local rivals BYD and German car manufacturer Volkswagen.

The new cars come amid an intense price war in China's new energy car market, which includes all-battery and hybrid vehicles. Such cars now account for more than 40% of new passenger cars sold in the country.

Li said he does not expect the main brand to adjust prices significantly, although he does expect price volatility in the market to continue for a while.

Nio plans a mid-May launch for its new brand, called Onvo or 'Le Dao' in Chinese, a name the company says is intended to reflect families – its target segment – ​​having a happy time together.

XPeng: We're bringing more AI into our vehicles

Xpeng, which sells its cars at a slightly lower price point than Nio, plans to launch its new sub-brand Mona in the next two or three months, vice chairman and co-president Brian Gu told CNBC on Thursday.

Gu said the new cars would sell for less than 150,000 yuan ($20,700), which is lower than the price range Nio is targeting. Last summer, Xpeng said it would develop a new mass-market brand at that price point through a strategic partnership with ride-hailing app operator Didi.

“The reason we are ready to tackle that segment is that we believe that with scale, with technology and with cost control we can make a difference[d] technology to the mass market,” Gu said, noting that in the past, only the premium market could benefit from high-end technology.

Xpeng has made its driver assistance software one of its selling points in China. Tesla's similar software for full self-driving cars is not yet available in the country.

Gu said in a briefing with reporters that Xpeng would differentiate the technology available to the mass-market brand from existing ones.

He also pointed out that there are at least a dozen brands competing in the premium segment, while only two or three brands currently account for about 80% of the mass market in China.

Tesla's Model Y is the best-selling pure battery electric SUV in China, priced below 250,000 yuan, according to Autohome data for the first quarter of the year.

Despite undermining the Model Y, Li said the new brand's first car will cost about US$30,000 (213,000 yuan) – not as low as BYD.

Chinese battery and electric car giant BYD has found most of its success at the lower end of the mass market. Over the past year, it has launched premium and luxury cars under new brands, expanding the company's product range from less than 100,000 yuan to more than 1 million yuan.

Among the many new cars planned for this year, BYD said Thursday it will launch a new hybrid car in the second quarter with a price range of 120,000 to 150,000 yuan.

Related Posts

Porsche 911 hybrid sports car unveiled for $164,900

2025 Porsche 911 Targa 4 GTS hybrid sports car Porsche Porsche unveiled the first-ever hybrid production version of its iconic 911 sports car on Tuesday, with a starting price of…

Should Elon Musk be paid $56 billion? Tesla shareholders are allowed to vote

It could be the highest-stakes popularity contest in history. Friends and foes of tech billionaire Elon Musk are in the middle of a two-month battle over whether to restore a…

Leave a Reply

Your email address will not be published. Required fields are marked *

You Missed

A social media chef reinvents American classics with an Asian twist: NPR

  • May 29, 2024
A social media chef reinvents American classics with an Asian twist: NPR

'Triple Lock Plus' will exempt 750,000 pensioners from tax, says IFS

  • May 29, 2024
'Triple Lock Plus' will exempt 750,000 pensioners from tax, says IFS

Georgian parliament overturns president's veto and 'foreign agents law' passes despite unprecedented international pressure – Protest by pro-EU groups (VIDEOS) | The Gateway expert

  • May 29, 2024
Georgian parliament overturns president's veto and 'foreign agents law' passes despite unprecedented international pressure – Protest by pro-EU groups (VIDEOS) |  The Gateway expert

Sweden will donate $1.23 billion in military aid to Ukraine

  • May 29, 2024
Sweden will donate $1.23 billion in military aid to Ukraine

The Supreme Court refuses to review the conviction of disgraced attorney Michael Avenatti in the Nike racketeering case

  • May 29, 2024
The Supreme Court refuses to review the conviction of disgraced attorney Michael Avenatti in the Nike racketeering case

72 hours left for the Disrupt early bird sale

  • May 29, 2024
72 hours left for the Disrupt early bird sale

Top adviser to the Dem Senate candidate posted a photo with a religious leader comparing Jews to termites

  • May 29, 2024
Top adviser to the Dem Senate candidate posted a photo with a religious leader comparing Jews to termites

Sunak promises to replace 'rip-off' degrees with apprenticeships

  • May 29, 2024
Sunak promises to replace 'rip-off' degrees with apprenticeships

Illegal alien arrested at Virginia truck stop for kidnapping and taking 'indecent liberties' with minors | The Gateway expert

  • May 29, 2024
Illegal alien arrested at Virginia truck stop for kidnapping and taking 'indecent liberties' with minors |  The Gateway expert

The Wu-Tang Clan's 'Once Upon a Time in Shaolin' is available from the Australian museum: NPR

  • May 29, 2024
The Wu-Tang Clan's 'Once Upon a Time in Shaolin' is available from the Australian museum: NPR

Orlando Pride is an example of a successful ideal rebuild in NWSL, while Utah Royals and San Diego Wave need to be rethought

  • May 29, 2024
Orlando Pride is an example of a successful ideal rebuild in NWSL, while Utah Royals and San Diego Wave need to be rethought