(Yicai) Aug. 14 -- The US’ Tesla, China’s Zeekr, Germany’s Volkswagen and seven other electric car makers have been reducing the price of their new energy vehicles in China since August to spur sales amid a highly competitive market.

Tesla slashed the price of its Model Y long-range and high-performance versions today by CNY14,000 (USD1,934) to CNY299,900 (USD41,436) and CNY349,900 respectively, the California-based firm said on its microblogging Weibo account. It is also subsidizing the cost of insurance on its Model 3s by CNY8,000 (USD1,102).

Zeekr is trimming the price of its Zeekr 001 by between CNY30,000 (USD4,142) and CNY37,000 to a starting price of CNY269,000, the electric car arm of Chinese car giant Geely Automobile Holdings said on Aug. 11.

While Volkswagen has cut the price of the ID series sold by two of its China joint ventures by between CNY20,000 (USD2,761) and CNY46,000 since July.

Hozon Auto, Nio, Chery Automobile, SAIC Motor’s MG and Great Wall Motor’s Ora have also all launched promotions, such as cutting price, subsidizing charging, battery-swap and maintenance services.

There will be a new round in the price war in the second half and competition could be just as fierce as in the first half, said Zhang Xiang, president of the NEV technology research center at the Jiangxi New Energy Technology Institute.

This is not the beginning of a new price war, as the price cuts are on quite a small scale, but it is difficult to judge the EV market at the moment, said Cui Dongshu, secretary-general of the China Passenger Car Association.

China is the world’s largest vehicle market, NEV market, and vehicle exporter, but it has a lower concentration compared with developed countries, Zhang said. The big players will seize more market share through price cuts and in this way eliminate smaller companies.

The need for a second car to drive children to and from school will rise when the new term begins at the end of August and this should help to keep the NEV market at its current size, the association said. The high fuel prices will also boost electric car sales.

Editor: Kim Taylor