(Yicai) Feb. 25 -- The joint venture that manufactures Audi and Volkswagen-branded vehicles in China will reduce prices of two pure electric models in the ID series by up to CNY55,000 (USD7,590) amid intensifying price competition.

FAW-Volkswagen Automobile, a partnership between China's FAW Group and Germany's Volkswagen Group, will lower prices of the ID.4 Crozz 2025 and the ID.6 Crozz, setting starting prices at CNY139,900 (USD19,300) and CNY195,900, respectively, the Changchun-based joint venture announced recently. According to public data, the ID.4 CROZZ sold 37,500 units in 2024, while the ID.6 CROZZ sold only 4,300 units.

Moreover, buyers can benefit from national replacement subsidies of up to CNY20,000 (USD2,760) and FAW-Volkswagen replacement subsidies of up to CNY10,000, the company added.

China's automotive price wars will persist into 2025 with expected escalation, Cui Dongshu, secretary-general of the China Passenger Car Association, predicted last month. Last year, prices were discounted on nearly 230 models, significantly exceeding the around 150 models in 2023 and 95 models in 2022, according to data from the industry organization.

Electric vehicle sales reached 744,000 units last month, representing an 11 percent year-on-year increase but a 43 percent month-on-month decline, based on CPCA data. This slowing growth has accelerated market segmentation.

Following the Spring Festival, Tesla initiated the price cuts in China, offering its largest-ever discount package for the Model 3, including a limited-time insurance subsidy of CNY8,000 (USD1,100) across the entire lineup, plus five-year zero-interest loans and exclusive charging privileges.

Subsequently, numerous automakers followed suit with price reductions or zero-interest financing. Among them, XPeng, IM Motors, and Great Wall Motor's sub-brand Wey have introduced five-year zero-interest loan programs.

Local JVs of foreign brands are implementing discounts to boost sales. For instance, models under GAC Toyota Motor, a partnership between GAC Group and Toyota Motor, have seen price reductions of up to CNY44,000, while Beijing Hyundai Motor, a joint venture between BAIC Motor and Hyundai Motor, has reduced prices for multiple models by up to CNY42,000.

Editor: Emmi Laine