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A radical discount on MG’s cheapest electric car nearly 12 months ago – intended to drive demand and clear stock – saw it lose “huge, huge money.”
Electric Cars
MG has revealed it lost more than $15 million in one month alone when it discounted the MG 4 electric car by up to $10,000 – to $30,990 drive-away – as part of a special, limited-time offer late last year.
The Chinese car maker says the discount – which boosted demand five-fold – was intended to get more MG 4s on the road to spruik the cheaper running costs of electric cars, and grow word-of-mouth interest in the vehicle.
“For the discount – just October, [in] one month [alone], I lost huge, huge money,” MG Motor Australia CEO Peter Ciao told Drive.
“I can't give the [exact] number, but it's more than $15 million. That one month. [Then in] November – and it continued.”
Multiplying the 1486 MG 4 sales reported in October 2024 by the discount – between $8262 and $10,425, depending on the state of registration – equates to between a loss in revenue of $12.3 million and $15.5 million.
It suggests MG’s profit margin on the base model MG 4 is very slim, making the $15 million monthly loss – which, compared to how much car makers earn each year, is only a small percentage – hit harder.
October’s deliveries were followed by 821 sales in November, 855 in December, and 440 in January 2025, as the discount was progressively wound back towards the car’s regular price.
Ciao said the discount was intended to demonstrate the low running costs of electric cars – when charged at home – to more customers.
“I still can remember in last September I had to make the decision. First one, the competition was more aggressive and we need[ed] a key. But in that moment, the electric share of the market had dropped to six, seven per cent,” he said.
“Because in that moment, even me, I was confused – it looked like [we were] los[ing] the confidence for an EV future.
“In Australia, everyone talks about Australia being short of public charging stations, but finally, I understand, no, Australia never should be compared with UK, China or Europe, or [need to] have the same public charging stations. Unnecessary, because the country is different.
“Australia has 75 per cent of people living in houses, [has] good sunshine resource, and government already sponsored solar for many years, so lots of families [have] solar. So what's that mean?
“… Most families need two cars. You don't need two seven-seaters in your home. One big-size SUV, one small-sized car … If your second family car [is] an electric car, that means the running cost [is] almost zero.
“The public, they already think, electric is not good, not good. So how to change that? In that moment, I make a huge decision. I say, "Okay, I big drop the price." Not price – a big campaign, a discount.
“You need people to agree with you. You need them to try. If they never can try, then how to agree with you?
“In that moment, I say, "I need an additional 2000 MG 4s on the road." After that, they will talk about with their friends, neighbours, ah, how good [is the] car, how good [is the] cost [of ownership]. That's my strategy.”
MG is preparing to expand its small electric-car range with a new, unrelated front-wheel-drive MG 4 – which may wear a name such as MG 4 Urban or MG 40, Ciao said – to be sold alongside the current rear- and all-wheel-drive model.
It will start from a lower price – less than $35,000 – thanks to its more cost-effective front-wheel-drive layout, and less focus on the driving dynamics that earned the current, rear-wheel-drive version praise, including the 2024 Drive Car of the Year Best Electric Vehicle Under $50K award.
“MG 4, this car is a drive performance car, it’s not a cheaper car,” Ciao told Drive.
“You may go [in the] interior [and say] ‘it looks ... simple’. A car is expensive or cheaper, not because the screen is big or small. That's a very small cost. The real cost is in the chassis, suspension and powertrain. ... And the CANBUS control system [the vehicle’s internal electronics].
“This car, MG 4 is under $50,000, pure electric, rear-wheel drive. Which [other] model [has that]? Which brand, which model?”
When directed to the $46,990 BYD Seal, Ciao said: “That's it. But I'm under $40,000.”
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Alex Misoyannis has been writing about cars since 2017, when he started his own website, Redline. He contributed for Drive in 2018, before joining CarAdvice in 2019, becoming a regular contributing journalist within the news team in 2020. Cars have played a central role throughout Alex’s life, from flicking through car magazines at a young age, to growing up around performance vehicles in a car-loving family. Highly Commended - Young Writer of the Year 2024 (Under 30) Rising Star Journalist, 2024 Winner Scoop of The Year - 2024 Winner
