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The EV market in China is fiercely competitive and has been embroiled in an escalating price war for many months, but demand has been strong amid a challenging macroeconomic backdrop, as illustrated by this morning's batch of September sales reports. One of the clear standout performances in September came from ZEEKR Intelligent Technology (ZK), the Chinese premium EV maker that went public on May 10 of this year. 

Following a 46% yr/yr increase in August, ZK's deliveries soared by 77% in September to 21,333 vehicles, pushing the company's cumulative deliveries to 339,506. Meanwhile, NIO (NIO), which also manufactures higher end EVs, such as the EL7 SUV, saw deliveries jump by 35% in September, while BYD Company (BYDDY) achieved a new milestone as quarterly deliveries surpassed the one million mark.

• In addition to the aggressive price cuts from EV makers, the roll out of more government subsidies has provided a jolt to demand. This past July, the PRC government doubled the trade-in subsidy for passenger cars to a maximum of 20,000 yuan.
• Furthermore, consumers have had more options to choose from as auto dealers build inventories ahead of the busy September and October months, and as EV makers continue to launch new, more affordable models to compete with Tesla (TSLA).
• On that note, XPeng (XPEV), which registered a 39% increase in deliveries for September, released its Mona M03 model this week with a base price that's under $17,000. This was preceded by NIO launching its own lower-priced brand called Onvo in May, which has a crossover vehicle called Onvo L60 that's priced about $4,000 less than TSLA's Model Y -- currently, the best-selling EV in China. In September, NIO delivered 832 L60 vehicles.
• ZK, however, is driving in the opposite direction, adding a new luxury vehicle to its lineup. On August 30, the company launched its mid-to-large SUV, the ZEEKR 7X, with deliveries beginning at the end of September. Next month, we should get a feel for how strong the market reception is when the company issues its October deliveries report.

The main takeaway is that, unlike the U.S., the EV market in China is gaining momentum as prices come down, as new models are launched, and as the government ramps up its subsidy program. Higher tariffs on Chinese EVs in the EU represent another potential speedbump, but up-and-coming EV makers such as ZK, NIO, and XPEV have so far defied the odds, emerging as legitimate competitive threats to TSLA and BYD.