China’s Ministry of Industry and Information Technology has summoned the leaders from more than a dozen major electric vehicle makers, including BYD and Xiaomi to Beijing to address concerns about the nation’s long-running EV price war.
Officials from the Ministry of Industry and Information Technology advised electric vehicle manufacturers to self-regulate, warning them against selling cars at a loss or offering unrealistic price cuts. They also discussed concerns over “zero-mileage” vehicles and rising bills from suppliers, which are straining cash flow in the supply chain and serving as a form of debt financing for automakers.
These warnings come after BYD’s decision to offer discounts of up to 34%, which has drawn criticism from industry groups and state media.
China’s Automobile Manufacturers Association issued a statement, indicating, “Disorderly price wars intensify vicious competition, further compressing corporate profit margins.” The Association pointed out that the nation’s “price war panic” was driving the sector into a “vicious cycle” and jeopardizing supply chain security.
China’s Ministry of Commerce announced today that it will step up its guidance for the auto industry to ensure fair competition and support healthy growth.
By CEO NA Editorial Staff
