In a bold move to challenge Elon Musk‘s Tesla Inc. TSLA, Chinese electric vehicle (EV) manufacturer, Zeekr ZK, is set to release its first SUV, priced to undercut Tesla’s Model Y in the Chinese market.
What Happened: Zeekr announced on Friday that it will launch its first SUV, the Zeekr 7X, in China next month. The new vehicle is priced at 239,900 yuan ($33,829), over $1,400 less than Tesla’s Model Y in China. The company plans to deliver the 7X globally by the end of the year.
The Zeekr 7X is equipped with two battery options that allow users to drive between 605 kilometers and 780 kilometers on a single charge. The company claims that its lithium-ion phosphate batteries offer the fastest charge in the world, beating Tesla’s, CNBC reported on Friday.
China’s EV market is currently experiencing a fierce price war. Earlier, Xpeng released its mass-market Mona M03 with models starting at less than $17,000. In May, Nio launched a lower-cost brand, Onvo, with cars priced $4,000 cheaper than Tesla’s Model Y.
As Chinese EV makers continue to release new models at lower prices, Tesla’s competitive edge in the market appears to be waning. A 2024 U.S. Initial Quality Study released in June showed that Tesla was losing its lead over legacy automakers due to quality concerns.
Despite these challenges, Tesla’s China Model Y prices have remained unchanged for nine consecutive weeks. In July, Zeekr sold 15,655 cars, a 30% year-on-year growth, while Tesla sold 46, 227 cars, a year-on-year rise of 47%.
Why It Matters: Zeekr, a subsidiary of Chinese automaker Geely Automobile, made a strong debut on the NYSE in May 2024, with its shares closing nearly 35% higher than its initial public offering price. The company’s aggressive pricing strategy for the Zeekr 7X appears to be a continuation of this momentum.
Furthermore, Zeekr plans to introduce a hybrid model in the latter half of 2025, equipped with Nvidia's Drive Thor autonomous driving chip. This move could potentially increase its market share in the EV sector.
Meanwhile, Musk has hinted at the possibility of a Tesla Model Y priced under $20,000. However, the feasibility of this remains uncertain, with industry experts expressing mixed reactions.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
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Photo courtesy: Zeekr
This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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