Chinese Tesla rival launches $22,000 EV with self-driving features

Xpeng, a Chinese competitor to Tesla, has recently unveiled its latest affordable electric vehicle, the Mona M03 EV. Priced at 119,800 yuan (USD 16,800), this EV comes in three different models, with the “Max” version including autonomous driving capabilities costing 155,800 yuan (USD 21,900). 

Notably, the base model of the M03 is priced at just over half of Tesla’s least expensive car, the Model 3, which starts at around 231,900 yuan (USD 32,500) in China. This development underscores the significant challenges Elon Musk’s company faces in maintaining competitiveness in the largest EV market globally.

Tesla has been consistently reducing prices in China over the past year to compete with local rivals. It is close to obtaining approval to sell its full self-driving technology in the country. The company faces tough competition from Chinese firms that offer technology-rich electric cars at lower prices.

Xpeng’s M03 enters a competitive market that includes Xiaomi’s SU7, a smart car with an estimated range of 500 miles and a price of approximately USD 30,000.

Chinese EV Manufacturers Compete on Pricing and Technology

In late 2023, BYD, a prominent player in the EV industry, briefly surpassed Tesla as the world’s largest EV producer. This year, BYD made significant price cuts, reducing the sticker price of its Seal electric sedan by 10,000 yuan to 179,800 yuan (USD 25,230) in March.

Additionally, Nio, a prominent premium EV manufacturer, is introducing Onvo, an affordable EV brand in China. Onvo is expected to directly compete with Tesla’s Model Y.

The L60, the inaugural vehicle in the Onvo lineup, is expected to be priced approximately $5,000 lower than the Model Y and will provide drivers with access to Nio’s network of battery-swapping stations. The company claims that this network can reduce charging times to as little as 3 minutes.

Nio, BYD, and Xpeng are touting their own versions of Tesla’s driving assistance technology. BYD is aggressively integrating more AI capabilities into its vehicles to attract technically inclined Chinese consumers.

These major Chinese EV manufacturers are encountering heightened competition in their domestic market and facing pressure to compete on pricing.

Elon Musk hopes to launch Tesla’s Robotaxi in China, a move that will give the US automaker a competitive advantage in the highly competitive electric vehicle (EV) market. However, Tesla’s success in this endeavor is not guaranteed.