Luxury car brands rushed to join the price cut after Chinese Premier Li Keqiang noted the country is determined to implement larger scale tax and fee cuts this year at a press conference after the conclusion of the annual session of China's national legislature.
(File photo: VCG)
"We are going to cut value-added tax rates for manufacturing and other basic sectors, as well as for small and medium-sized companies, the largest providers of jobs in our country, in a meaningful way," Li said last Friday.
The auto market responded to the fiscal plan soon via sale price adjustment. On March 17, Lincoln, an American luxury car brand, announced that it would cut the recommended retail prices of all models sold by manufacturers effective immediately in China. Among them, the manufacturer's suggested retail price of Lincoln Navigator's honorable version was lowered to 1.098 million yuan ($16.4k), a decrease of 20,000 yuan ($3,000).
The move came a day after Volvo auto sales (Shanghai) co. Ltd. said on March 16 that it would cut the recommended retail prices of all models sold in China, including the model flagship luxury SUV XC90, which fell by up to 60,000 yuan ($9,000).
Mercedes, BMW and other luxury car brands have announced price cuts of up to 60,000 yuan as well last week.