China is the world’s largest auto and electric vehicle market, and everyone wants a piece of the pie. The battle between global and local brands is intense and even more intense in the electric vehicle sector as a large number of startups are also vying for attention. In all of this, Mercedes-Benz finds itself in a precarious position because despite its dominant market share in the luxury segment, the electric vehicle segment is still quite complex.
Mercedes-Benz CEO Ola Kaellenius admitted that the Chinese electric car market could mature more from affordable electric vehicles. “It’s absolutely true that the growth of the electricity market in China has started at the bottom. Segments where we have almost nothing,” he told Reuters. “The premium and luxury segments are still in their infancy. We have to apply some patience strategy here and see how this evolves.”
Mercedes offers models like the EQE and EQS electric SUVs in China, and late last year it was forced to cut prices to make these models more attractive to potential buyers. While the demand for electric vehicles in China is growing, the growing number of players has led to fierce competition. Some of the biggest global players here include Tesla, volkswagen and Mercedes. The dominant domestic players are BYD, SAIC, Great Wall Motor, Geely, Xpeng, Chery and Nio. Models like Hong Quang small The EV – launching in 2020 – has a price tag of 28,800 yuan or about $4,300. There are dozens of vehicles in the $10,000 to $15,000 price bracket made by local brands.
So while critics may continue to claim that China’s labor costs are low and that local companies tend to spend less on research and development, there is still a concern. persistent deposition for established brands offering attractive prices regardless of production location in the segment.
Date of first publication: February 18, 2023, 18:52 PM IST
