Soaring Chip Prices Drive Up EV Production Costs, Prompting Price Hikes

Due to rising upstream raw material costs, supply chain shifts, and intense competition from the AI industry for chip resources, automotive-grade DRAM memory prices have surged dramatically since the second half of 2025. DDR4 prices have jumped by over 150%, while DDR5 prices have skyrocketed by 300%, resulting in an overall price increase of 180% in the past three months alone. The rising cost of memory chips alone has added RMB 1,000 to RMB 3,000 to the per-vehicle cost of new energy vehicles (NEVs). Lu Fang, Chairman of Voyah Auto, advised consumers to purchase vehicles sooner rather than later, as cost pressures are rapidly being passed on to the end market. Li Bin of NIO also noted that automakers are struggling to compete with AI companies and computing centers for chips, as the latter enjoy gross margins of up to 65% on HBM memory, exacerbating ongoing shortages of automotive-grade chips. Exeed, a premium brand under Chery, has already announced a RMB 5,000 price hike for the high-end variant of its ET5 model, while Zeekr’s newly launched 007 GT is expected to see a price increase of RMB 5,000 to RMB 8,000.