Chinese officials summoned the heads of major electric vehicle makers, including BYD, to Beijing earlier this week to address concerns about long -term price war, according to the people familiar with the matter.
The Ministry of Industry and Information Technology, the market organizer and the most important economic planning agency said that the people, who asked not to learn to discuss private information. The people said that the gathering was attended by senior executives of more than ten manufacturers also included Zhejiang Geely Holding Group Co. And Xiaomi Corp.
Officials told EV makers of “self -organization”, and that they should not sell cars without cost or provide unreasonable price cuts. They also dealt with issues such as “”ZeroThe people said that cars and fixing bills due to suppliers who press cash flow along the supply chain and work as a semi -diploma for automobile companies.
It is rare for the organizers in the market, industry and economy in China a joint meeting with the auto industry on operational issues such as pricing. This step shows the amount of scrutiny that the country’s best leadership pays to this sector, amid fears that the price of price has become unnecessary and can send weaker companies to bankruptcy. However, the assembly did not result in mandatory guidance and not clear what the consequences will face manufacturers if they do not follow verbal warnings.
BYD and Xiaomi did not respond to the comments requests. A representative from Geely referred to a recent letter from the Chairman of the Board of Directors, Lee Shufu, who said that the company refuses to firmness of price wars and will compete for technology and their values.
The Ministry of Industry and Information Technology, the state administration to organize market, and the National Committee for Development and Reform did not respond to fax questions. The Ministry of Commerce said during a routine briefing on Thursday that it will work with other departments to enhance the guidance of the auto industry, ensure fair competition and enhance health development.
Warnings come after bydGo outThe last round of price war in late last month, with discounts of up to 34 %, which led to criticism from industrial bodies and government media.
Without name, the Chinese Automobile Manufacturers Association issued astatementSaying that this step by a specific company began a new round of the “panic price of price” that was flooding the sector in a “vicious cycle” and threatening the supply chain. The association said: “Unorganized price wars intensify evil competition, which increases the pressure of companies profit.”
The media that it controls directly by the Communist Party leadership, including Xinhua, has published CCTV Daily Daily and Daily and State CCTV in the last days that called on automotive companiesStopDiscount andRe –Order of industry. Otherwise, this may lead to low -priced and low -quality products that will destroy international reputation and “manufacture”.
This week’s meeting is the second time in the last days when industry leaders were reprimanded by “Zero-Milege” cars-a practice in which the car manufacturers failed that failed to achieve their sales goals to new vehicles for supply chain financing companies or used car dealers.
These new cars appear mainly in the resale market without any miles, while manufacturers record them as sales despite their failure to reach the final consumer. The Ministry of Commerce also met with at least two car makers and car platforms used online last week on this issue.
Car makers are trying to transfer the strike from the price war to suppliers, which demands a decrease in parts of partsdelayPayment bills in months. LowerSeekBy BYD to one of its suppliers late last year, it attracted media coverage and auditing how Ev Beheemoth can use the supply chain to hide its enlarged debt. Report through GMT Research Accounting ConsultingNet debtAt the earliest to 323 billion yuan ($ 45 billion), compared to 27.7 billion yuan in its books starting from the end of June 2024, by delaying its payments for suppliers and other relevant funding.
This story was originally shown on Fortune.com
