China's Leapmotor and Aito report record high deliveries in May amid price war

In a remarkable display of growth, Chinese electric vehicle manufacturers Leapmotor and Aito achieved record delivery numbers in May, as the industry faces mounting pressure from a price war. Leapmotor, supported by Stellantis, reached an unprecedented delivery figure of 45,067 vehicles, marking an impressive 148% increase compared to the previous year. This surge was bolstered by the recent launch of their revamped C10 model, a mid-sized SUV priced at 122,800 yuan ($17,045), with over 13,000 units sold in May alone. Aito, backed by Seres and utilizing Huawei technology, also celebrated a milestone, delivering 44,454 vehicles as of May 15. The automaker introduced its ultra-luxury Maextro S800 sedan on May 30, with a starting price of 708,000 yuan. Meanwhile, BYD maintained its dominance in the market with 376,930 vehicles sold during the same month. Overall, car sales in May experienced a year-on-year rise of 14.1%, according to calculations by CNBC based on publicly available data. In a move that sent shockwaves through the industry, BYD reduced prices on 22 of its models, slashing the cost of the Seagull hatchback by 20% to 55,800 yuan, leading to declines in share prices among Chinese automakers. The company has faced scrutiny over alleged pressure on one of its dealers concerning cash flow, which BYD has denied. The escalating price competition has raised concerns of potential fallout reminiscent of the Evergrande crisis, which saw the former real estate giant default on its debts in 2021. Xpeng, while reporting a slight decline in May deliveries to 33,525 vehicles from 35,045 in April, still showed a remarkable year-on-year growth of 230%. The company launched new models, the Mona M03 Max and Plus, retailing from 129,800 yuan and 119,800 yuan, respectively. Xiaomi mirrored its previous month’s performance with over 28,000 vehicles delivered, and teased an upcoming YU7 luxury SUV set for launch in July. Other manufacturers like Li Auto and Zeekr saw modest increases, with Li Auto delivering 40,856 vehicles (up 16.7% year-on-year) and Zeekr reporting 18,908 vehicles (1.6% increase). Nio faced a decline in monthly deliveries, totaling 23,231 vehicles despite a 13.1% year-on-year growth, with its family-oriented brand Onvo contributing 6,281 units, marking its strongest month of the year. As competition heats up, Chinese automakers are exploring diversification strategies, although tariffs from the European Union and the United States on Chinese EVs could hinder expansion into Western markets. Instead, there is a growing interest in emerging markets, including recent reports of BYD's entry into Benin in partnership with CFAO Mobility.