Chinese carmaker XPeng is reportedly raising prices of its electric vehicles (EV) by CNY10,000-20,000 (US$1,500-3,200) due to inflation in material prices and persisting shortages of semiconductors, according to industry sources.
While XPeng has not officially confirmed or commented on the reported price hikes, Tesla China, BYD, Chery, Neta (Nezha), and nearly 20 EV makers in China have announced that they will raise prices in March. Overall, nearly 40 EV models are more expensive today than they were last year.
Tesla China has raised the official selling prices three times in March 2022 alone. Its website shows that prices of Model 3 high performance, Model Y long range and high performance versions have increased by at least CNY10,000.
BYD also officially raised prices of its Dynasty and Ocean series by CNY3,000-6,000. Chery said prices will be CNY3,000-6,000 higher due to rising materials prices. Neta hiked the prices of some models by CNY3,000-5,000.
Surging nickel prices
Nickel, the key material in making EV batteries, has risen from US$8,000 per tonne in 2016 to around US$20,000-US$30,000 per tonne this March. The war between Russia and Ukraine sent nickel prices to a record US$100,000 per tonne, increasing by more than 200% within just five days from March 4 to March 8.
As prices of nickel sulfide rise, ternary materials prices have risen by CNY160,000-250,000 per tonne. The surge in materials prices led to rising production costs of ternary batteries, whose price rose by CNY31-57 per kWh. As a result, for a 70kWh EV, the production costs of the end-product would increase by at least CNY2,000-3,000.
Renesas production disrupted by earthquake
An earthquake in Japan last week overshadowed the already tight supply of automotive semiconductors. Japan-based automotive chip vendor Renesas has disclosed production at three of its fabs were affected by the earthquake.
Disruption at Renesas may not have immediate impact on EV production because automotive MCUs take at least one year from placing orders to delivery.
