China's automaker price war threatens profitability: analysts

Slumping car sales, new emission rules result in deep discounts for buyers

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Prospective buyers check a Tesla Model 3 car at a showroom of the U.S. electric vehicle maker in Beijing. © Reuters

KELSEY CHENG, Caixin

The rash of recent price cutting in China's auto market could further squeeze the profitability of manufacturers already struggling with slowing demand, analysts have warned.

"The evolving price war in China's car market ... is likely to extend into the second quarter and erode profitability along the entire automobile value chain in 2023," analysts at Fitch Rating said in a report on Thursday.

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