China pledges to address ‘irrational competition' in EV sector
The vow came in a State Council meeting Wednesday that was chaired by Premier Li Qiang, according to China Central Television. The gathering of what is essentially China's cabinet added that authorities would also effectively regulate market order in the sector.
Authorities would also step up investigations and monitoring of prices, the state broadcaster said. They'd also encourage companies to boost competitiveness through innovation and improved product quality, CCTV added, without giving details on how that would be done.
The government's focus on the EV sector comes after China's top leadership pledged to curb aggressive price competition among businesses. While economic growth is on target to meet the the official 5% expansion goal for the year, a worsening decline in prices threatens to drag the world's second-largest economy into a prolonged slowdown.
China's EV industry has become a world leader — BYD Co. sold more fully electric cars in Europe than Tesla for the first time ever in April — that has raised tensions with the US and European over potential damage to their industrial bases.
Last month, Chinese officials reportedly summoned the heads of major EV makers, including BYD, to Beijing to address concerns about the long-running price war. Officials told EV makers to 'self-regulate,' and that they shouldn't sell cars below cost or offer unreasonable price cuts.
Also in June, BYD and and Zhejiang Geely Holding Group Co. joined several of China's government-backed automakers in a pledge to standardize bill payment for their suppliers to 60 days.
The carmakers had been seeking lower-cost components and delaying payments to suppliers by months, creating a form of quasi-debt financing. –BLOOMBERG
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Malay Mail
2 hours ago
- Malay Mail
Air raid sirens bring Taipei to a standstill in civilian drill simulating Chinese attack
TAIPEI, July 17 — Taipei's normally busy streets will come to a brief standstill today when air raid sirens send thousands of people into underground shelters in a rehearsal for a Chinese attack. The annual civilian drill is being held in cities across Taiwan this week, alongside military training, to prepare the self-governed island for a potential Chinese invasion. While Communist China has never ruled Taiwan, Beijing insists the island is part of its territory and has threatened to use force to bring it under its control. At 1:30 pm sirens will be heard across Taipei, bringing the capital city of 2.5 million people to a halt for half an hour. Traffic will be required to stop and people will be directed into shelters, including underground car parks and subway stations. The drills will also involve simulating war-time aid distribution and a mass-casualty event. Since taking office last year, Taiwanese President Lai Ching-te has sought to raise public awareness of the threat posed by China. Of the drills, 25-year-old Oscar Wang said: 'I think this is necessary because tensions across the strait are so high right now.' 'So it's important to let us ordinary people become more familiar with evacuation routes,' he told AFP. 'Reality of modern warfare' Taiwan is also keen to show the world, especially its key security backer Washington, that it is serious about boosting its defence capability. Taiwanese regular troops were joined by the largest-ever mobilisation of reservists for the 10-day 'Han Kuang' military drills, which end Friday. Rather than only repelling a Chinese attack on its shores, Taiwanese troops this year have also practised fighting invading forces in city streets. 'It is as much training as acclimating the Taiwanese population to the reality of modern warfare,' said Kitsch Liao of the Atlantic Council, a US think tank. Heavily armed troops carrying US-provided anti-aircraft Stinger missiles stormed Taipei's metro system in a night-time exercise. High-tech mobile missile launchers from the United States also have been positioned around the capital and elsewhere, in full view of the public. And shoppers in a Taipei supermarket recently became participants in a drill simulating a Chinese missile strike on the city. 'I didn't know there was going to be a drill,' Yang Shu-ting, 70, told AFP. 'My heart was beating very fast and I was inevitably nervous. I think the point is to let you know where you should hide if something happens.' Troops have also simulated various scenarios including 'grey zone harassment'—tactics that fall short of an act of war—and 'long-range precision strikes', defence officials have said. Several minor collisions involving military vehicles during the exercises highlighted the challenge of manoeuvring through Taiwan's narrow streets. Defence expert Chieh Chung said such mishaps were 'difficult to avoid' in urban areas. 'In Taiwan, many roads and bridges create significant limitations for armoured vehicles when they move through,' said Chieh, a researcher at the Association of Strategic Foresight in Taipei. 'So this becomes a problem and obstacle for both attacking and defending forces.' — AFP
Malay Mail
2 hours ago
- Malay Mail
China moves to tame ‘irrational competition' as EV price war persists
BEIJING, July 17 — Chinese officials are seeking to tame the country's swelling electric vehicle industry with policies to prevent 'irrational competition', state media said, as a brutal price war ensnares top automakers. Beijing has poured vast state funds into the EV sector, supporting the development and production of less polluting battery-powered vehicles. But a price war has left many startups bust as firms flood the domestic market with low-cost cars and trade-in schemes, offering huge discounts to customers to give up their old auto for a new one. Domestic criticism has mounted in recent months against intra-industry 'involution' — a popular tag used to describe the race to outcompete that ends up nowhere. A meeting of top officials in Beijing — chaired by Premier Li Qiang — called yesterday for tighter price monitoring and improving long-term regulation of competition in the sector, state news agency Xinhua said. Officials called for stronger order in the new energy vehicle market to 'curb irrational competition' and spur more healthy development, Xinhua said. 'It is necessary to... strengthen industry self-discipline' and help companies enhance their competitiveness through technological innovation, the agency quoted officials as saying. The China Association of Automobile Manufacturers, a top industry group, warned in May that 'disorderly' competition would exacerbate harmful rivalry and hurt growth. Analyst Bill Bishop wrote in his Sinocism newsletter that the wording of yseterday's readout could suggest Beijing will place 'price controls' on electric vehicles. 'The language on the new energy vehicle (NEV) industry was tough, in another sign that the government is going to intervene to rectify the 'irrational competition' in the industry,' he wrote. — AFP
The Star
2 hours ago
- The Star
Top Glove set to capture more market share in US
Top Glove said it believes Chinese competitors cannot sustain ultra-low pricing seen during from 2022 to 2023. PETALING JAYA: Top Glove Corp Bhd is expected to register a robust recovery, buoyed by a strong uptick in orders from the United States that could drive double-digit sales volume growth in the fourth quarter of its financial year ending Aug 31, 2025 (4Q25) analysts say. The company sees the United States as a key growth engine, with current momentum in exports pointing to a steady climb in market share. During a recent meeting with Top Glove's management, Kenanga Research reported a marked improvement in sales to the US , which gained further traction this month and now accounts for 30% of the group's total volume – a significant jump from 26% in the previous quarter. The research house added that Top Glove is potentially taking market share away from other glove players in the US market. 'The group is aiming for the United States to account for 40% of group sales volume over the next two years,' Kenanga Research said. 'It is optimistic about strong sequential sales volume growth in 4Q25 due to higher orders from the US market which more than offset a slower Europe,' it added. Top Glove's confidence is underpinned by a notable rise in utilisation rates, which hitt 65% as of last month, compared with 61% in 3Q25 and 58% in 2Q25. The uptick translates to over 3.3 billion pieces of gloves sold per month – up from below three billion in April – which could add as much as RM70mil per quarter, or 2% of revenue. 'Top Glove expects sales volume to grow 15% quarter-on-quarter, driven by US orders and higher utilisation in 4Q25,' Kenanga Research said. 'In fact, utilisation rate last month was 65% compared with 61% in 3Q25,' the research house added. The group also appears unfazed by recent tariff-related concerns, expressing optimism that demand will remain strong. 'Top Glove feels that there is only so long that customers can hold off buying,' the research house said, adding that order volumes began rebounding over the last two months, with the positive trend expected to persist next month. On the pricing front, the group highlighted the competitive edge Malaysian producers still hold despite shifting tariff dynamics. US-imposed tariffs of 80% to 130% on Chinese medical gloves for this year and next year have widened the pricing gap in Malaysia's favour by between 10% and 30%, while Vietnamese and Indonesian gloves, though subject to lower tariffs of 20% and 19%, respectively, have minimal global market share or production capacity to pose a major threat. 'However, a Chinese player may ramp up production in Indonesia due to the tariff differential, which would be a risk, albeit starting at around just 1% of global supply by our checks, and this may be a negative for Malaysia given an improved tariff rate of 19% versus Malaysia's 25%,' Kenanga Research cautioned. In terms of average selling prices, Top Glove said it believes Chinese competitors cannot sustain ultra-low pricing seen during from 2022 to 2023. 'The group estimates that break-even prices for Chinese glove makers are at US$14 to US$15 per 1,000 pieces compared with efficient Malaysian producers at US$15 to US$16,' the research house said. Kenanga Research has maintained its 'outperform' call on Top Glove with an unchanged target price of 93 sen, citing the group's scale and improving utilisation as factors for better margins and competitiveness in the critical US market.
