Instead, demand has been so poor that he’s had to cut prices 3 percent from a year ago and reduce his profits.
Instead of rapid price gains predicted by some economists at the beginning of the year, China is experiencing a rare period of falling prices. That’s a clear contrast to the rocketing inflation that followed the reopening of the US and other major economies, and is visible both at the factory gate and retail side.
Also, a price war among carmakers triggered by Tesla Inc.’s reductions led other major brands to join in with steep discounts earlier this year. The government has been downplaying concerns about deflation, with officials from the People’s Bank of China, National Statistics Bureau and other agencies repeatedly saying there’s no foundation for long-term price declines.