(Yicai Global) March 13 -- The price war that began in China’s new energy vehicle sector after Tesla cut prices at the beginning of the year leaves used car dealers facing losses as they too are forced to follow suit.

Feng Jian, a secondhand car dealer in the city of Zhengzhou, told Yicai Global that there are few buyers. Used car dealers are not buying secondhand autos because they are afraid they will not be able to sell them because the cost of new ones is falling, he added.

Chinese NEV makers began to lower their prices after US electric car startup Tesla started the ball rolling in January. The NEV price war has also spilled over into the market for fossil fuel-powered cars.

Automakers have just started to cut their prices, Feng added, noting that it may not have a significant impact now, but second-hand car dealers will have to start selling vehicles at a loss, and used autos will lose their advantage.

A secondhand Dongfeng Citroen C6 sells for about CNY140,000 (USD20,365). But after subsidies and price cuts, a new one costs only CNY120,000 in Hubei province, Yicai Global found.

A used Tesla dealer in Zhengzhou said the cuts have greatly impacted his business. He bought a second-hand Tesla Model Y for CNY297,000 from a client who purchased it last year for CNY316,900. But as new Model Ys sell from just CNY259,900 after reductions, he had to sell it for CNY240,000, losing about CNY50,000 (USD7,270).

It was rare for the price of a new car to drop by CNY50,000, CNY80,000, or even over CNY100,000 in the past years, but it happened this year, said Feng, who has 18 years of experience in the secondhand car market.

Editors: Shi Yi, Futura Costaglione