In response to Tesla's recent price hike in China and the arrival of Xiaomi in the electric vehicle market, according to VCPost, Chinese domestic automakers are rolling out enticing offers to attract potential buyers.

According to The Business Times, Shanghai-based Nio unveiled a plan offering incentives worth up to 1 billion yuan (S$186.4 million) for gasoline car owners to switch. The plan also includes benefits like battery swaps, additional driving assistance subscriptions, and even a Nio mobile phone.

Meanwhile, Xpeng has slashed prices on some models by up to 20,000 yuan, and Chery Automobile is covering purchase taxes on selected models while improving trade-in deals for used cars.

These maneuvers contrast with Tesla's own move to raise prices on its Model Y SUV earlier in the day, which was anticipated to drive up demand ahead of the increase. 

READ NEXT: Tesla Stock Drops to An All-Time Low Of -29% in 2024 First Quarter Due to Increasing Chinese Competitors

However, despite the hike, Tesla had to scale back production at its Shanghai factory.

Currently, there is intense competition among automobile companies in China, the world's largest automobile market. Undeterred by a decline in Tesla's shipments during the first two months of 2024, the overall sales of passenger vehicles in China have increased.

Plus, competition escalates further with Xiaomi's entry into the electric vehicle market and the announcement of its SU7 model with pricing and order availability. In fact, within just 24 hours of the announcement, Xiaomi received over 88,898 pre-orders, indicating major interest in its product.

Tesla has yet to provide plans to counter EV competition in China. However, VCPost reported that Tesla is spending millions on advertisements, although Musk is not a fan of them.

READ MORE: China's Xiaomi, Tesla's New Rival, to Begin Deliveries of Its First EV Model This Month