EVs are getting smarter and cheaper in China

STORY: Light-up emojis.

Music for pedestrians outside.

In China, electric carmakers are offering up luxury tech – without the luxury price tag – in the battle for buyers.

Cars are being loaded with once-expensive interior features and technology for as low as $20,000 – less than half the cost of the average new car in the U.S.

Analysts say that poses a big challenge for foreign heavyweights like Tesla and Volkswagen.

This is the Nammi – on display here at the Beijing auto show.

It’s made by state-owned automaker Dongfeng and sells for under $10,000.

That’s around the same as BYD’s Seagull EV – China’s fourth best-selling electric vehicle.

The market is also crowded with electric and plug-in vehicles that splash luxury technology.

Xpeng is planning to offer an EV with high-level self-driving features – for under $21,000.

Analysts say the price of specialized components like sensors needed for self-driving and screens for onboard entertainment has tumbled.

That's making competition in the world’s largest auto market all the more fierce…

And chipping away at the halo that once hung over foreign brands.

That’s according to an outlook from McKinsey analysts released in March.

Take Zeekr, for instance.

It's the carmaker with those emojis.

Here’s its Shanghai head of design, Javier-Garcia Gallardo:

“When we see the differences between our product launch in China versus our product launch in Europe and, you know, the technical details are as important as the design and the brand. And this integration of technology is essential for the Chinese customer.”

Still, German automakers say they’re not backing down.

Here’s Mercedes-Benz CEO Ola Kallenius:

“We have a dedicated digital tech team here all the way down to providing things like in the new E-Class, you can sing karaoke. Maybe you don't have that feature in Germany. Maybe you should. But here, customers love it.”

Mercedes, as well as Volkswagen, both told Reuters they’re working to deliver those so-called “wow effects” for Chinese buyers.