Industry group warns Chinese carmakers against aggressive ‘price war' after discount spree, citing market stability concerns
BEIJING, May 31 — A top industry group had a stern rebuke today for automakers fuelling a 'price war', a week after Chinese EV giant BYD announced sweeping trade-in discounts, with multiple competitors following suit.
'Since May 23, a certain automaker has taken the lead in launching a substantial price drop campaign... triggering a new round of 'price war' panic,' the China Association of Automobile Manufacturers (CAAM) said in a statement posted to its WeChat account.
The group warned that such 'disorderly' competition would 'exacerbate harmful rivalry' and hurt profit.
The statement, dated May 30, did not single out any company by name, but on May 23, BYD announced it was offering big trade-in discounts on nearly two dozen makes, offering discounts of up to 34 per cent.
Its cheapest model, the smart-driving Seagull, now goes for a starting price of 55,800 yuan (RM33,200), down from 69,800 yuan, with a trade-in.
Days later, Stellantis-backed Chinese EV startup Leapmotor announced similar discounts on two 'entry-level' models through June 8.
Geely Auto announced Friday limited-time trade-in subsidies for 10 models, with its X3 Pro going for the lowest starting price of 44,900 yuan.
But there is growing domestic criticism against what the autos association called 'involution'—a popular tag used to describe the race to outcompete that ends up nowhere.
The CEO of China's Great Wall Motor, whose annual revenue was roughly a quarter of BYD's, compared it to the start of China's years-long housing slump triggered by the 2021 default of property giant Evergrande.
'Evergrande in the auto industry already exists,' Wei Jianjun said this month in an interview with Chinese outlet Sina Finance.
'I hope that... all these years of hard work will not go to waste.'
Beijing has poured vast state funds into the electric vehicle sector, supporting the development and production of less polluting battery-powered vehicles.
But China's automakers association today warned its goliaths to play fair.
'Leading companies must not monopolise the market,' the CAAM statement said.
It added that 'with the exception of lawful discounting, companies must not sell products below cost nor engage in misleading advertising'.
Such behaviour disrupted the market and harmed both consumer and the industry, it said.
An unnamed official from China's Ministry of Industry and Information Technology added that price wars 'produce no winners and no future', the state-backed Global Times reported today. — AFP
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
2 hours ago
- The Star
Consumers, manufacturers key to enforcing EV battery recycling
PETALING JAYA: The government's plans to push for the recycling of depleted electric vehicles (EVs) batteries must be enforced among both manufacturers and consumers to be environmentally sustainable, say environmental groups. Sahabat Alam Malaysia president Meenakshi Raman said manufacturers or importers of EVs must be legally required to collect back the same number of EV batteries as the vehicles they sell or bring into Malaysia. 'Failure to do so should result in fines or legal penalties. Companies that design longer- lasting or easier-to-recycle batteries should be rewarded with tax incentives. 'There must also be clear guidelines, good enforcement and proper facilities in place because used batteries could end up being dumped or handled in unsafe ways, causing harm to the environment and public health. 'Only licensed certified companies should be allowed to handle used EV batteries,' said Meenakshi. She also urged the government to invest in propping up local recycling facilities and the development of an EV battery passport initiative that would track key battery information such as composition, origin, usage history and recyclability. 'An EV battery passport system will allow for better resource management as this makes it easier to identify which batteries can be reused, repurposed or need to be safely dismantled. 'Grants or tax breaks should be given to companies that invest in recycling technology or use recycled materials. 'The government should also consider supporting second-life uses for EV batteries such as repurposing them for solar energy storage before they are fully recycled, extending each battery's life and reducing waste,' she added. Environment Protection Society of Malaysia vice-president Randolph Jeremiah said manufacturers must be legally mandated to take responsibility for the safe disposal or recycling of EV batteries. 'Manufacturers must be made to establish their own recycling facilities, either domestically or in their country of origin or partner with local specialised recyclers. 'Extra tax benefits could be offered for those that invest in their own local recycling infrastructure as it strengthens Malaysia's circular economy ecosystem, allowing for the prevention and better handling of other environmental issues in the long run. 'Consumers must also be legally mandated to return used batteries to designated collection points for a cost, creating a closed-loop ecosystem where fiscal and environmental responsibility is shared by both consumers and manufacturers. 'This model would ensure long-term economic and environmental viability while preventing potential crises from inadequate recycling capacity,' he added. EcoKnights president Amlir Ayat proposed that a dedicated task force be set up to oversee this issue, particularly related to the disposal of EV battery waste that cannot be recycled. 'Any policy on EV battery recycling must be concrete, with continuous monitoring and enforcement being diligently conducted to ensure there are no potential legal or management loopholes which could lead to toxic waste management under the guise of recycling. 'The critical part now is securing the commitment from all parties, particularly the producers and consumers, through clear communication to avoid any such risks which may lead to disastrous consequences,' he said. He also urged the ministry to continue gathering public feedback on the matter.
The Star
2 hours ago
- The Star
Second life for dead EV batteries
PETALING JAYA: With the number of electric vehicles (EVs) in Malaysia on the rise, talks have begun with EV producers on what to do with the almost 900,000 depleted lithium-ion batteries by 2050. This is because if they are improperly disposed, the depleted EV batteries could pose environmental and health challenges for the nation. CLICK TO ENLARGE 'We are currently working towards introducing an Extended Producer Responsibility (EPR) initiative for EV batteries. 'If you manufacture EVs, you will also be responsible for the batteries at the end of their lifespan. 'This includes the retrieval of the batteries for recycling or otherwise,' said outgoing Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad ( pic ) during a recent interview with The Star. Special interview with Nik Nazmi15 MAY 2025 —CHAN TAK KONG/The Star The issue of depleted EV batteries, he said, needs to be addressed as the number of EVs in the country is expected to rise in the near future. 'We are looking at how best to deal with the increasing number of EV batteries as the number of EVs is set to rise. ALSO READ: 'EV ecosystem urgently needed' 'This is likely to happen when the RON95 targeted petrol subsidy is implemented and with the entry of cheaper EV models,' he added. It was reported that based on an eight-year battery lifecycle and registration data of EVs in the country, the number of depleted EV batteries that will need to be processed is estimated to increase drastically from 40,000 in 2030 to 330,000 by 2040 and 870,000 by 2050. The number of new EVs registered in Malaysia has surged in recent years, rising from 274 units in 2021 to 21,789 units last year. For this year alone, a total of 7,942 EVs have been registered as of April, representing a significant year-over-year growth of 79.7% compared to the same period in 2024. China, which is currently the world's top EV producer, has an EPR policy to recycle 70% of EV batteries by 2030, while the European Union (EU) has regulations for EV manufacturers to design batteries aimed at recycling. ALSO READ: Consumers, manufacturers key to enforcing EV battery recycling In Japan, the country's automakers work with the local councils to conduct battery collection and reuse programmes while the United States has set aside over US$3bil (RM12.7bil) under its Bipartisan Infrastructure Law for battery material recycling and second-life research. Nik Nazmi said talks have begun with EV manufacturers here on the EPR, although no formal decision has been made yet. 'Talks have begun but informally. It was done – not on a formal platform – but we (the ministry and EV makers) had the chance to meet at events. 'We have yet to formalise talks with the EV manufacturers,' he said, adding that the EPR would come under the responsibility of the Environment Department. The department, said Nik Nazmi, is also drafting designated guidelines for the disposal of EV batteries and solar panels which are listed as scheduled waste. 'The designated guidelines are needed to address the increase of EVs in the country as well as the use of solar panels. 'More and more people are turning to solar energy, and there has been an increase in the use of solar panels over the past few years. 'This is in line with the nation's transition to renewable energy and the increasing electricity tariffs,' he said. Nik Nazmi said recycling EV batteries is one of the main approaches to be taken when dealing with depleted batteries. 'We have agreed that this is the best way forward as it will also lessen our dependence on mining for the minerals required to produce the batteries,' he added. The global EV battery recycling market is expected to grow to US6.5bil (RM27.56bil) in the next five years. According to the Malaysian Investment Development Authority (Mida), the nation's battery market is projected to grow at an annual rate of 5.28% from 2022 to 2027.
The Star
2 hours ago
- The Star
‘EV ecosystem urgently needed'
PETALING JAYA: With electric vehicle (EV) adoption among Malaysians beginning to kick off, the need for a EV battery recycling ecosystem is more crucial than ever, say stakeholders. This is to prevent the irresponsible disposal of depleted batteries. CLICK TO ENLARGE Electric Vehicle Association of Malaysia president Datuk Dennis Chuah said such an ecosystem could help reduce the current dependence on constantly making new EVs and then disposing of the old ones, which is an expensive practice. 'By recycling EV batteries, we can recover valuable materials like lithium, cobalt and nickel which can then be reused for other purposes or to make other batteries, making it less expensive to dispose of them. 'This also reduces our reliance on mining (for these materials) while supporting a circular economy,' he added. To support such a recycling ecosystem, the government could consider implementing a mandate on manufacturers to only make EV battery designs that can be easily disassembled, he said. He added that a second-life policy for depleted EV batteries should also be considered, which would allow these devices to be repurposed for other energy storage applications. 'This can include being used in stationary energy storage systems to support the national electricity grid, helping to stabilise the grid during peak periods or emergencies. 'This will require investment in training programmes for battery recycling and repairs as EV producers look to extend the lifespan of EV batteries beyond their original purpose,' Chuah said. Malaysian EV Owners Club vice president Farhan Abdul Rahim said that for such an ecosystem to succeed, it must include both clear regulatory frameworks and infrastructure to succeed. 'Challenges such as the lack of localised recycling facilities or unclear accountability among stakeholders could hinder the setup of such an ecosystem. 'This could lead to the public finding it too difficult or pointless to recycle EV batteries – either due to inconvenience or feeling no social pressure or responsibility to do so,' he said. To overcome this, he said the government should look into setting up a national recycling centre which would mandate that EV battery recyclers meet international standards. By having a centralised body and system, this would help provide assurance and confidence to the public while also making it easier to track EV batteries in the country – from the moment of production to end-of-life. 'Education on safe disposal and take-back options must also be driven into the public to better ensure higher compliance,' Farhan added.
