BYD price cuts spark plunge in global rubber futures

Concerns grow over intense price competition in Chinese auto sector

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Chinese electric vehicle giant BYD's price cut announcement has raised concern about price war. © Reuters

MACHIKA SUZUKI

TOKYO -- International prices for natural rubber are plummeting as price cuts by major Chinese electric vehicle maker BYD triggered concern that a possible price war in the country's auto sector will weigh on tire prices.

Speculation that price reductions for EVs and plug-in hybrids will lead to downward pressure on tire prices has resulted in a drop in the natural rubber market. Tires account for 70% of natural rubber demand.

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