The price war among electric car brands in China, the largest automotive market in the world, has led Chinese authorities to make it clear that they intend to put an end to the situation, which threatens the sustainability of the industry.
The warning comes at a time of strong sales growth, but also of increasing concerns about oversupply and the viability of many of the new manufacturers that have emerged in the country.
Market leader BYD announced that it sold 2.1 million vehicles in the first six months of the year, an increase of 31% compared to the same period in 2024. Almost half of those sales correspond to 100% electric vehicles, with the remainder being hybrids, according to data released by the company.
The manufacturer has been criticized for launching successive rounds of price cuts on its models, the most recent in May, which led several competitors to follow suit.
The president of Great Wall Motors, Wei Jianjun, then warned that the current trajectory threatens the entire industry. For its part, the Chinese government has committed to combating what it describes as a form of exhausting and unproductive competition, which has become characteristic of several sectors in China.
The Chinese Association of Automobile Manufacturers has called for healthy competition, while the Ministry of Industry and Information Technology stated that the current situation represents an obstacle to the sustainable development of the sector.
To compensate for the erosion of margins in the Chinese market, brands have turned to exports. BYD more than doubled its sales outside of China in the first half of the year, reaching 464,000 units.
However, here too, Chinese brands face difficulties with the imposition of tariffs by the U.S. and Europe, which claim there is unfair competition due to state subsidies granted to Chinese companies.
