Nio, Tesla's Chinese rival, reduces the price of its new Onvo-branded vehicle.

• Nio's lower-priced brand, Onvo, unveiled its first car, the L60 SUV, which will be available for purchase at a starting price of 149,900 Chinese yuan ($21,210) when including battery services.
• A model with the battery and the car starts at 206,900 yuan.
• Deliveries are set to begin Sept. 28.

Another Chinese electric car is targeting Tesla with a steeper discount.

The premium electric car company, Onvo, announced its first car, the L60 SUV, will start at a low price of 149,900 Chinese yuan ($21,210) when purchasing battery services through a monthly subscription, starting at 599 yuan. This equates to approximately $1,000 a year for "renting" the battery.

The car with the battery will start at 206,900 yuan and deliveries will commence on Sept. 28.

The Onvo L60 launch caused Nio's stock to rise by more than 3.5% in U.S. trading on Thursday.

The L60 from Nio's Onvo brand will be sold at 219,900 yuan, while Tesla's Model Y is priced at 249,900 yuan.

The Zeekr 7X, a midsize electric SUV, will be launched by -backed in China on Sept. 20, with a starting price of 239,900 yuan.

In late August, the company announced that its mass market brand Mona would begin selling its M03 electric coupe in China. The basic version of the car starts at 119,800 yuan, has a driving range of 515 kilometers (320 miles), and includes some parking assist features.

The Mona M03 with advanced "Max" driver assist features and a driving range of 580 kilometers will cost 155,800 yuan.

The price of Tesla's cheapest car, the Model 3, in China was reduced to 231,900 yuan after an April price cut.

Chinese electric car companies have been expanding overseas, typically beginning in Europe. However, the European Union is near the conclusion of a process that will impose higher tariffs on imported Chinese-made battery electric vehicles starting in early November. The bloc initiated an investigation into the Chinese EV manufacturers' utilization of subsidies last year.

The EU's probe did not sample Nio, resulting in a 20.8% duty on its cars, higher than the 19.9% tariffs for Geely and 17.4% for BYD.

Nio CEO William Li announced on a Sept. 5 earnings call that the company plans to begin deliveries in the United Arab Emirates in the fourth quarter.

The tariff in Europe has increased the cost of selling or exporting cars from China to Europe, as stated by Li, according to a FactSet transcript.

"We will concentrate on the five European markets we have already entered, while understanding that it may take longer to establish NIO as a premium brand in Europe. We are patient with this process."

"Li stated that although we have not ceased our activities in that location, we have continued with our installation and deployment of power swap stations in Europe."

He anticipates 15% vehicle margin on the new Onvo-branded cars, with the L60 expected to reach 10,000 monthly deliveries in December and 20,000 vehicle deliveries a month next year.

By the end of this year, the brand intends to have over 200 stores in China, with more than 100 already open as of early September.

On the earnings call, Li stated that Onvo and Firefly, a lower-priced brand set to launch vehicles next year, would target the international market.

— CNBC's Sonia Heng contributed to this report.