(Yicai Global) Nov. 22 -- A number of luxury vehicle brands in China have begun offering discounts of up to 20 percent because recent Covid-19 outbreaks have sapped demand.

Many first-tier luxury models are between 15 percent and 20 percent cheaper than shown in price guides, according to vehicle sales and information platform Autohome. Mercedes-Benz offers discounts of up to CNY130,000 (USD18,170) on its high-end models, while the prices of some Audi A6L sedans and BMW 1 series have been cut by CNY110,000 and CNY80,000, respectively.

The decline in sales was mainly caused by the sluggish consumer market, unlike that in the third quarter of last year, which was caused by the auto chip shortage and high market prices.

But sales have not picked up greatly despite the big discounts on offer, Cui Dongshu, secretary general of the China Passenger Car Association, told Yicai Global.

“Carmakers lowered out sales goals for the first half, but it’s still a challenge to achieve the target for this quarter, so we have no choice but to cut prices,” the sales head of a luxury vehicle dealership said. Even expensive cars that were previously hot items have to be discounted, the person added.

“The latest discounts began earlier this month, and many car models’ prices have been cut,” the sales manager at a BMW 4S brand store in Beijing told Yicai Global, noting that they have enough cars in stock. “Not many visitors enter the store, and we’re trying our best to sell vehicles by offering big discounts,” a salesman added.

First-tier cities, where most buyers of luxury brands live, have been greatly impacted by the pandemic this year, leading to a decline in demand for luxury cars. Sales in Shanghai, Beijing, Guangzhou, Shenzhen, Chongqing, and Tianjin accounted for 20 percent of the national total last year, according to the annual luxury car market report by Huajing Production Research Institute. Shanghai ranked first and Beijing second.

Second-hand luxury vehicles are also in weak demand. Dealers are left with no option but to continue trimming prices because of overstocking and limited demand, a second-hand car dealer told Yicai Global.

Editor: Martin Kadiev