China’s Price War Favors the Cars Beijing Is Trying to Phase Out

(Bloomberg) — A dangerous cocktail in China of intensifying competition, weak consumer spending and sluggish car sales has led to vehicle price cuts that are only extending and deepening — and electric vehicles aren’t necessarily the ones benefiting.

EV giant Tesla Inc. kicked off a price war that quickly enveloped other manufacturers earlier this year. Now two-thirds of auto brands in the world’s largest car market are offering discounts. Price slashing has become broad-based even after the government recently extended tax breaks through 2027 for consumers buying clean cars.