GM CEO Mary Barra says there's so much EV competition in China that it's driving a price war that isn't sustainable

BUSINESS INSIDER: General Motors CEO Mary Barra has said there are so many companies trying to sell electric vehicles in China right now that it's driving a price war that isn't sustainable.

Barra made the comments at the TechCrunch Disrupt conference in San Francisco on Tuesday, responding to a question about the explosion of EV sales in China. More than 120 brands sold EVs in China in 2023 compared with about 60 in the US — putting into perspective just how much competition there is for GM and other manufacturers.

The EV market in the country is oversaturated, Barra said Tuesday, echoing comments she's made recently. She said that the EV business in the country was "shifting dramatically" — and that "lower and lower" prices being driven by such competition would become untenable.

"From a China perspective, EV adoption has been heavily regulatory-driven," Barra said, referring to the Chinese government's push for EV adoption. "But what also has occurred is there are over a hundred Chinese OEMs right now, primarily focused on EVs," she added. OEMs are original equipment manufacturers that create parts for other businesses to use in their products.

The flood of EV-focused startups pushing inexpensive vehicles in China has posed increasing challenges for European and US automakers in recent years.

"You have to look at what the sustainable business is because the situation that is there right now is not sustainable," Barra said. "Of the hundred or so companies, only less than a handful are profitable," she said. Business Insider didn't independently verify Barra's calculations.

European automakers have also struggled in China's competitive EV market. During its third-quarter earnings call earlier this month, Mercedes-Benz reported a 31% drop in sales of battery-powered cars year over year.

GM, meanwhile, outperformed Wall Street's estimates and sent shares soaring more than 9% following its third-quarter earnings report. In China specifically, GM sold 14% more vehicles in the third quarter than in the second. And for the first time, its NEV category — new energy vehicles, which include EVs — sold more than its internal-combustion models in China, GM said.

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