(Yicai) June 18 -- The joint ventures of Chinese and foreign carmakers have cut the prices of some premium models by as much as CNY100,000 (USD13,800) or more in response to heightened competition brought about by the launch of new energy vehicles in China.

High-end models such as the BMW 3 Series, Audi A4L, and Mercedes-Benz C-Class cost about CNY200,000 each now, a third less than originally priced, Yicai found at 4S stores in Guangzhou. Mid-end sedans are down to between CNY150,000 and CNY130,000 from about CNY200,000, while compact sedans are on sale for CNY60,000 to CNY70,000 (USD8,270 to USD9,650), down from CNY120,000 to CNY130,000.

“Many automotive JVs are slashing their prices,” said a sales consultant at a Volvo store in the southern city. “Since the end of May, we’ve launched big price cuts on multiple models, with the Volvo XC60 and S60 now priced from CNY260,000 and CNY200,000, given high inventories. Clients can negotiate to buy models in stock at even cheaper prices.”

The market shares of the foreign auto JVs in China are rapidly shrinking. Last month, their combined retail sales plunged 21 percent from a year earlier to 490,000 units, according to data from the China Passenger Car Association. The sales of independent Chinese carmakers, mostly new energy vehicle startups, jumped 12 percent to 980,000 for an 57.6 percent market share, up 7.3 percentage points.

Retail sales of China’s top 10 auto JVs all fell in May. FAW-Volkswagen recorded the steepest decline of 17.5 percent, with the drops for SAIC Volkswagen and GAC Toyota at around 10 percent each, the CPCA data also showed. FAW Toyota fell out of the top 10.

Lower pricing did show results last month as the sales of some models picked up. Nonetheless, many young customers at the showrooms Yicai visited said they will pay more attention to NEVs, especially their smart features, delisted there being more fuel-powered cars priced around CNY200,000 to choose from following the price reductions.

Chinese NEV models priced at about CNY300,000 are equipped with 360-degree cameras, in-car systems with large screens, Level-2 driving assistance, and other smart functions. In comparison, the Volvo XC60 is outdated and lacks many of those fancy features, one customer said, adding that the NEVs of independent Chinese carmakers are more attractive because they are very smart.

Editors: Tang Shihua, Futura Costaglione