Chinese officials call on carmakers to clamp down on price spiral

South China Morning Post

21-07-2025

In discussions with major carmakers, China has repeatedly brought up the 'irrational competition' driving down prices – an economy-wide issue threatening the buoyancy of
emerging growth drivers , particularly new energy vehicles (NEVs) – calling for firms to establish lasting standards to ensure fair and orderly market activity.
As Beijing seeks to rein in a
cutthroat price war driving down growth potential in the sector – a trend that is also fuelling deflationary pressure – industry leaders gathered in the capital for two symposia held over two consecutive days, according to two statements released by the Ministry of Industry and Information Technology (MIIT) late Friday. Officials present instructed companies to take action and reverse the slide.
'It is vital to recognise the extreme urgency of curbing irrational competition in the NEV industry,' said Che Jun, deputy head of a central guiding group, at a meeting with the China Association of Automobile Manufacturers, the foremost trade association for carmakers. Representatives from Beijing Automotive Industry Holding and BYD also attended.
Guiding groups are dispatched by the Central Committee of the ruling Communist Party to provide supervision and guidance to localities and industries relevant to the group's designated area of focus.
Che stressed that the problem is prone to recurrence and therefore requires sustained, long-term efforts. Leading companies should set an example for the rest of the industry, he added, by engaging in lawful and rational market competition.
The other symposium was held by MIIT, the National Development and Reform Commission and the State Administration for Market Regulation, with representatives from 17 leading carmakers present. The assembled government bodies said healthy industrial development should be promoted through cost oversight and price monitoring.