Massive $20,000 price cut for European electric SUV: EV war heats up in Australia as sub-$40,000 Peugeot e-2008 takes aim at the 2024 BYD Dolphin, GWM Ora and MG ZS EV

There is a new sub-$40,000 electric car on sale in Australia from a surprising European car brand.

Peugeot has slashed the price of its e-2008 small electric SUV by more than $20,000 to $39,990 drive-away. This mammoth price cut is sure to upset previous customers who paid full price.

This puts it in the same ballpark as smaller cut-price Chinese EVs such as the GWM Ora ($35,990), BYD Dolphin ($38,890) and MG ZS EV ($39,990).

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The new price also makes it cheaper than Peugeot's base model 2008 Allure petrol that starts at $38,945 (before on-road costs).

Adding to this, the e-2008 comes exclusively in fully-loaded GT trim, meaning it has desirable items such  as a panoramic sunroof, 18-inch alloy wheels and a 10-inch multimedia screen with 3D satnav.

Buyers can also expect multi-coloured ambient lighting, a digital dash and plenty of premium material used throughout the cabin.

There is a catch, though.

The e-2008's numbers are fairly underwhelming by EV standards.

An updated version of the e-2008 is due soon.

Its small 50kWh battery is paired with a single electric motor that sends 100kW and 260Nm to the front wheels,

It’s not quick, hitting 100km/h from a standstill in about nine seconds and its driving range is only 328km.

All drastically reduced price models are 2023 versions and an updated car is due to land in Australia in the near future with increased power and driving range.

Increased competition at the lower end of the electric car market has led to a price war with Chinese brands dramatically cutting the price of their cars to drive sales and clear old stock.

Last week BYD cut the price of its volume selling Atto 3 electric small SUV by as much as $8000 and GWM has significantly reduced the starting price of its slow selling Ora small hatchback.

The e-2008 has an impressive list of standard equipment.

The Tesla Model Y and Model 3 have also had a price haircut in the past month.

Since the start of April the best-selling Model Y is now between $4500 and $8500 cheaper depending on the variant.

The updated Model 3 was only launched in January and is now between $3000 and $4000 more affordable since the start of April.

Electric car sales in Australia slowed in April, down about five per cent, but the EV market is up more than 30 per cent for the year.

Australia has yet to hit the electric car sales slowdown seen in the more mature markets of Europe and North America.