The automotive industry is experiencing a significant and intense price war, a phenomenon that has been escalating since 2023 and is set to soar even higher in 2025. This fierce competition is becoming more pronounced as brands fight for market share amidst a backdrop of an evolving consumer landscape that favors cost savings and incentives over loyalty.
Almost immediately into the new year, over 30 car brands, including giants like BYD and Tesla, initiated an aggressive pricing strategy aimed at bolstering salesThis marked the onset of a new phase in the automotive price war, which has compelled established manufacturers and new entrants alike, such as Changan, Geely, and various emerging startups collectively dubbed “Wei Xiaoli” (the new forces in car manufacturing), to offer extensive discountsSuch promotional strategies include immediate price reductions, cash rewards, and government subsidies that often exceed 10,000 yuan.
This price war has dragged car manufacturers into what can only be described as a survival competition
As companies work to adapt, they are not just pushing for market share; they are also transmitting immense pressure to their sales teamsSales personnel are often on the front lines of this crusade, and they face the combined challenges of hitting stringent sales targets while braving the stigma of being the ones who may bear the brunt of customer dissatisfaction and corporate pressure.
A recent incident underscored this pressure, as a Tesla salesperson in Shanghai gained notoriety after verbally assaulting a customer who had deleted them from WeChat, following numerous attempts by the salesperson to promote replacement subsidiesThis incident shines a light on the underlying tension that excessive pressure to sell can create, serving as an explosive catalyst for customer relations turning sour.
Selling cars has transformed into a high-stakes game where sales teams face daily evaluations against rigorous targets, including metrics like the number of test drives initiated and the duration of time spent on telephone pitches
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In this scenario, sales personnel can be perceived as both the frontline soldiers and the collateral damage of corporate strategies aimed at boosting sales volumes in a market poised for extreme competition.
From the onset of 2025, sales figures have already begun to reflect the harsh realities of this competitive landscapeZhou Ran, a manager at a local electric vehicle dealership, recently reported losing two sales staff in just the first week of the year—a significant loss for a company already feeling the crunchThis included one veteran employee who left without waiting to receive their year-end bonus, a clear indicator of the mounting pressures faced by sales teams.
Through Zhou’s experience, one thing is abundantly clear: as the pressure mounts to sell more cars, his strategies for evaluating and incentivizing sales staff have had little effectShort-staffed amidst ongoing demands for more production, new hires often take time to ramp up, adding additional strain to the already beleaguered team, and Zhou is well aware that any further attrition could threaten his position as manager.
The approximately simultaneous launch of promotional events by brands such as Li Auto and Xpeng only amplifies the sense of urgency as they offer significant price cuts to capture consumer interest
For instance, on January 2, Li Auto announced a replacement subsidy worth up to 15,000 RMB for certain users, while Xpeng began its incentives on the first day of the month with cash discounts of around 10,000 RMB, further contributing to the frenzy.
This environment demands dealerships shift their sales targets and practices accordinglyZhou’s company was compelled to raise the first quarter sales goals by 10% compared to previous expectations—a decision driven home by corporate missives that tacitly warned of dire consequences for those unable to adapt to heightened competitionA clear survival motto emerged from his company’s leadership: “Sell without incurring losses and strive to see 2026.”
The ambitious sales targets placed on Zhou come with significant personal stakesHis dealership must outperform major competitors such as Tesla, which enjoys stronger brand recognition and a larger operational scale in the market
As Zhou grapples with these demands while battling the lack of competitive pricing incentives, he finds himself questioning how his team can possibly navigate a climate that increasingly favors established manufacturers.
For the salesman, these targets directly impact not only their earnings but their sense of job security as wellZhou's team had been expected to sell six to eight cars per day, but that number has now increased, inevitably resulting in performance-related deductions plaguing both staff morale and financial compensation.
As the pressure intensifies, Zhou describes a hectic atmosphere with promotions occurring virtually every weekNew strategies necessitate that cars be showcased in unconventional venues such as schools, all while maintaining ever-increasing expectations across various sales metricsThe strain is palpable, with Zhou describing disarray amongst lightly seasoned employees who often struggle to cope with the relentless pace of business.
In this fast-paced environment, how are new salesmen faring? Take Liu Ya, for example, a newcomer who has hopped between over ten different car manufacturers in the span of just year
Liu has experienced the steep learning curve that comes with navigating a cutthroat landscape, wherein inexperienced employees find it exceedingly difficult to stand out amidst intense internal competition.
As she reflects on her challenges, Liu notes that the high base salaries offered by major player dealerships have created an enticing lure for fresh graduates, intensifying competition for roles in the automotive sectorHowever, the transparency in pricing has diminished the leverage salespeople once held, forcing many to repeatedly engage customers across multiple channels in a constant battle for the best deals.
The reality for Liu and her peers is that, despite their growing resumes, their experiences can vary widely between different manufacturersThe challenge lies in finding a supportive work environment, which becomes increasingly elusive as external pressures from upper management cascade down to the sales floor, creating a toxic atmosphere rife with anxiety and competition.
Now, as 2024 unfolds, the stakes continue to rise
The market now stands stark, bifurcated between those manufacturing traditional vehicles struggling to find footholds against the flood of electric vehicle entrantsLiu notes how she continues to conduct comparisons among competing brandsSales meetings feel almost endless, focused on dissecting competitor offerings and formulating strategic responses, yet any introduction of new models immediately disrupts sales consistency.
Consequently, the question lingers: who will ultimately come out on top in this relentless race? With promising brands fraught with peril and others, like NETA, operating on the fringes of viability, the fear remains that for many within the industry, the joys of the job and its financial rewards may slip away in the face of constant turmoil and uncertainty.
One look at the statistic illustrates this precarious situation further; the scale of price reductions across the market reached staggering heights in 2023, with a whopping 227 models affected by price cuts, eclipsing the lower figures from previous years
The average price drop of electric vehicles stood at 18,000 RMB, revealing a market that is fiercely wrestling not only with broader changes but the very notion of profitability.
Even as sales volumes rise, car manufacturers are discovering an alarming trend: increased sales do not equate to increased profitsThe industry has drifted into an era of “fewer profits but higher sales,” leading scrutiny to fall upon sustainability and strategic viability for many in the field—especially amidst rapidly evolving consumer expectations and unprecedented competition.
Ultimately, as the automotive industry claws its way through this upcoming turbulence of 2024, one fact remains clear: the fierce battles waged on the sales floors of dealerships across the country will only heat upThe price war is a reflection of deeper shifts within the industry, and for every fleeting victory, there are countless others striving to simply endure.