Chinese EV Giant's Price Slash Sparks New Price War in Auto Market

Comparing the Chinese electric vehicle giant's approach to how Chinese artificial intelligence startup DeepSeek recently shook the global AI industry with its low-price AI offering, observers fear it might spark a new price war in an already fiercely competitive market.

Chinese automakers Xpeng and Geely Auto's stock fell on concerns that they would find it difficult to compete with BYD's decision to provide free smart driving capabilities for practically all of its models. Geely's stock dropped 7.2%, while Xpeng's shares dropped 5.9%, the most in two months. The shares of BYD that are listed in Hong Kong increased by 0.9% to hit a record high.

On Monday, BYD began selling 21 vehicles that came with its "God's Eye" advanced driver-assistance system (ADAS), which is comparable to what Tesla offers and comes at no extra cost. The Seagull is the least expensive model it sells, costing US$9,555.

In the past, BYD had only provided models starting at US$30,000 with these characteristics, which let cars to drive themselves on highways while being supervised by a human driver. In China, Tesla offers these features in its EVs, which start at $32,000 USD. In the US, its Full Self-Driving (FSD) driving assistant software costs US$8,000, or US$99 a month. In China, FSD is now unavailable.

"We welcome the official upcoming announcement by a leading automaker I respect extremely for its smart driving strategy, that will bring about the popularisation of smart driving not only in China but also globally," He Xiaopeng , CEO, Xpeng said.