China's car sales stay flat in March amid price war sparked by Tesla: Report

Sales of new energy vehicles, which include pure battery electric cars, rose 21.9% in March and accounted for 34% of the month's sales, the data showed.

Growth in sales of China's passenger vehicles was flat in March from a year earlier, industry data showed on Monday, as more price cuts by auto brands and the rollout of incentives by local governments helped to support demand.

A car produced by Chinese automobile manufacturer Chery is on display for sale (File Reuters) (REUTERS)

Car sales in March were 1.61 million units, the China Passenger Car Association (CPCA) said. In the first three months, sales had fallen 13.4% to 4.33 million units, it added.

Sales of new energy vehicles (NEVs), which include pure battery electric cars and plug-in hybrids, rose 21.9% in March and accounted for 34% of the month's sales, the data showed.

BYD led the segment with market share of 35.5%, while Tesla accounted for 14%.

There is no doubt that April will see a good recovery in sales growth, Cui Dongshu, the association's secretary general, told reporters, citing a low base in the corresponding period last year.

China imposed strict COVID-19 lockdowns in major cities, such as its commercial hub of Shanghai, in April 2022.

More than 40 brands have joined a price war started by Tesla this year, among them Nissan, Toyota and Volkswagen, which have started offering aggressive discounts on their best-selling ICE models to defend market share.

Local authorities, who see the auto industry as a pillar of the economy, have also been rolling out buyer subsidies to drive demand and some of these programmes have started to extend to automakers, to spur manufacturing.