EV Makers Struggle to Implement Price Hikes as Market Promotions Turn Rational

Recently, several new energy vehicle (NEV) manufacturers have announced price hikes, but actual implementation has proven difficult. Premium automakers, with gross margins typically exceeding 20%, face relatively low profit pressure and thus lack strong motivation to proactively adjust prices. Meanwhile, mid- to low-end automakers are constrained by intense competition and a shrinking market capacity, making widespread price increases unlikely. From a cost perspective, export prices for power batteries have declined year-over-year, while domestic battery prices have seen only modest increases, exerting limited upward pressure on costs. Additionally, a large number of new models have entered the market at low prices, further squeezing profit margins and pricing flexibility for existing models—leaving most automakers’ announced price hikes confined to rhetoric rather than reality. Since 2025, promotional activities and price reductions in China’s passenger vehicle sector have become more rational, significantly improving market order. With the reinstatement of purchase tax on NEVs, the impact of manufacturers’ suggested retail prices on consumers’ tax burdens has started to emerge. In 2026, a total of 56 vehicle models lowered their prices, down by 12 compared to the previous year. Among them, 25 conventional internal combustion engine (ICE) models reduced prices (up by 8 year-over-year); 3 hybrid ICE models cut prices (unchanged from the prior year); 9 plug-in hybrid electric vehicles (PHEVs) lowered prices (down by 4 year-over-year); 3 range-extended electric vehicles (REEVs) reduced prices (down by 2 year-over-year); and 16 battery electric vehicles (BEVs) cut prices (down by 14 year-over-year). In April 2026 alone, 13 models lowered prices, down by 1 year-over-year, including 2 hybrid models (up by 2 year-over-year) and 4 BEV models (down by 1 year-over-year).