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Xpeng and Geely stocks drop as BYD offers free advanced smart driving features, intensifying competition.
Shares of Chinese automakers Xpeng (9868.HK) and Geely Auto (0175.HK) fell sharply on Tuesday amid fears that they would find it difficult to compete with BYD's new strategy of offering advanced driver-assistance systems for free in most of its models. Xpeng tumbled as much as 9.2 per cent, the biggest one-day percentage drop since October 2024, as Geely, its biggest outside shareholder, retreated 11.4 per cent. BYD's Hong Kong-listed stock rose 4.5%, hitting a fresh record before trading 0.7% down.
BYD is getting closer to equipping 21 of its models, free of any additional cost for customers, which is ahead in the race over its competitors. The Seagull is the most affordable model in BYD's lineup, with a starting price of just $9,555. Analysts believe that this move will trigger a new price war in the fiercely competitive Chinese EV market. BYD is offering three versions of the "God's Eye" system, ranging from basic features like automated parking and lane-keeping to more advanced autonomous driving capabilities in complex urban environments. In the past, these features could be found only on models over $30,000. Tesla, another big player in China's EV market, charges its Full Self-Driving software $8,000 in the US, or $99 per month via subscription. Xpeng welcomed the announcement of new smart driving technology but didn't comment right away on BYD's move.
John Zeng from consultancy GlobalData stated that Xpeng and its peers are under considerable pressure but will find it challenging to match BYD’s affordable pricing. Leapmotor, another Chinese automaker, responded by launching a new EV with smart driving features priced under 150,000 yuan ($20,529.67). As competition intensifies in China’s auto market, smaller rivals are struggling to keep up with BYD’s aggressive pricing and frequent model releases.
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