© Reuters. FILE PHOTO: People walk past an ID. Store X showroom of SAIC Volkswagen in Chengdu, Sichuan province, China January 10, 2021. Picture taken January 10, 2021. REUTERS/Yilei Sun
BEIJING (Reuters) – SAIC Volkswagen (ETR:) Automotive Co is offering 3.7 billion yuan ($537 million) in cash subsidies for car purchases in China, joining more than 40 brands in what analysts have called a price war in the world’s largest auto market.
The joint venture between China’s SAIC Motor Corp Ltd and Germany’s Volkswagen AG (OTC:) is offering 15,000 yuan to 50,000 yuan in subsidies until April 30 for its full lineup, which includes the Teramont, Lavida and Phideon models, SAIC-VW said on its WeChat account late on Thursday.
Guangzhou Automobile Group, the Chinese partner of both Honda Motor Co Ltd and Toyota Motor (NYSE:) Corp, has also offered subsidies running from March 15 to March 31.
Chinese passenger vehicle sales fell 20% in January-February, industry data showed, even as some manufacturers offered reduced prices to stimulate demand.
Sales of new energy vehicles, which include all-battery and plug-in battery-petrol hybrid vehicles, grew faster than the overall market, accounting for over 30% in February. In the same month, Chinese electric vehicle maker BYD Co (OTC:) Ltd outsold Volkswagen-branded cars for the second month in four.
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