Chery boss says electric car price war is bad for Australians
09/20/2024 06:00 PM
While other brands have slashed electric vehicle prices substantially, Chery says it won't enter into a price war as its first electric vehicle lands in Australia.
Chinese car maker Chery's first electric vehicle (EV) in Australia – the Chery Omoda E5 SUV – costs less than its main rival but the car maker says it's not interested in entering a price war.
At $42,990 plus on-road costs, the entry-level Omoda E5 BX small SUV undercuts arch rival BYD Atto 3's $44,499 before on-roads starting price as one of the most affordable small electric SUVs in Australia.
Both the Chery and BYD are undercut by the similarly-sized MG ZS EV in Australian showrooms – due for replacement in 2025 – which has seen more than $15,000 in price cuts in the last 18 months to be $34,990 drive-away.
MG has sliced the entry point to EV ownership event further this week, with a limited-time offer of $30,990 drive-away for the MG 4 Excite 51, but this deal only applies until 31 October.
Despite MG's lower prices Chery Australia says it's not looking to enter a price war for the cheapest electric-car bragging rights – with MG, BYD and GWM having squabbled over the mantle of Australia's cheapest electric vehicle by as little as $100.
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"With the Omoda E5 we think we’ve priced it competitively and about where it probably deserves to be," Chery Australia Chief Operating Officer (COO) Lucas Harris told Drive.
"I hope we don’t see really aggressive cost cutting. For EVs I know there’s been a little bit of it. Personally, I hope it slows down and starts to normalise for everybody’s sake.
The MG brand is not alone in slashing prices of electric cars in Australia, with BYD, Tesla, Renault and Nissan among a number of car makers to cut prices in 2024.
While the European Union and the United States have introduced higher import tariffs specifically targeting Chinese-made electric vehicles, Australia has not followed, having signed a Free Trade Agreement (FTA) with China in 2015.
The cuts – including $10,000 taken off the Renault Megane E-Tech's listing price and a $15,000 reduction for the Ford E-Transit electric van – led an enquiry into Australia's transition to electric vehicles to declare price war between car makers.
Harris told Drive the car maker won't be entering into a similar price war.
"It's certainly not good for the brands, having those kinds of price wars," Harris told Drive.
"It’s not good for dealers. It’s actually not good for customers either, because all of those people that have trusted you to buy your car six months ago, but now their car’s been devalued $10,000 overnight because you’ve decided to slash the price…”
Chery has also opened order books for the Tiggo 4 Pro small SUV – due in showrooms in October 2024 – with a conventional petrol powertrain but one of Australia's cheapest new cars at $23,990 drive-away.
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