Market Growth in May 2025
The Chinese electric vehicle industry is experiencing a significant upswing in sales figures in May 2025, while an intense price competition among manufacturers is raging. BYD has pressured competitors with massive price discounts, triggering a new competitive dynamic.
Sales Figures May 2025
- BYD: In May, over 200,000 fully electric vehicles were delivered – an increase of approximately 40% compared to the previous year.
- NIO: Deliveries rose to 23,231 vehicles, which corresponds to a growth of 13.1% compared to the same month last year.
- Li Auto: About 40,000 vehicles were sold in May, a rise of approximately 16% compared to the previous year.
- XPeng: Together with NIO and Li Auto, the three companies delivered nearly 98,000 vehicles – a total increase of around 50% compared to the previous year.
Price Competition and Margin Pressure
BYD has stirred up the market with aggressive price reductions, forcing other manufacturers like NIO, Li Auto, and XPeng to react:
- Margin Pressure: Li Auto’s profit margin from vehicle sales dropped from 22.7% (Q4/2023) to only 19.7% (Q4/2024).
- NIO is working on improving margins and aims for a margin of at least 20%; however, this goal is becoming more challenging due to the price competition.
- XPeng was able to slightly increase its margin (from about 10% to approximately 10.5%), but remains unprofitable; any further price reduction makes reaching profitability even more difficult.
Impact on Stock Prices
Despite the intensified competition, the stock markets reacted positively to the strong sales figures:
- Stock prices rise: Following the announcement of sales figures, particularly BYD, NIO, and Li Auto stocks increased.
- Investor interest remains high, as the growth potential of the Chinese EV market is still considered attractive.
Summary
The Chinese electric vehicle market is characterized by strong growth alongside price pressure: While BYD sets the tone with massive discounts, competitors like NIO, Li Auto, and XPeng must adjust their strategies – often at the expense of their margins or profitability. Nevertheless, robust sales figures still signal great potential for all major players in the sector.