The Chinese government has issued competition guidelines for automakers operating overseas, prohibiting the use of price-cutting strategies to compete in the global market. The document, titled "Guidelines for Overseas Competition and Compliance Regulatory System," was formulated by China's Ministry of Commerce along with two other government agencies and consists of four parts, aiming to prevent a repeat of domestic price wars in foreign markets. Meanwhile, China's EV exports are growing rapidly, with BYD exporting 189,466 new energy vehicles in August, more than double the previous year, and overseas sales in the first half of the year increasing by 34%, while domestic sales fell by 31%. Geely Automobile Holdings exported 110,094 vehicles in August, a threefold increase, accounting for 41% of total sales. The guidelines also emphasize that manufacturers should set prices based on costs and supply-demand dynamics in the global market, avoid false advertising, and adapt their businesses to local markets, amid concerns from governments worldwide about impacts on employment and domestic production bases. However, experts point out that government support remains a key factor enabling loss-making manufacturers to expand export capacity, and previous regulatory measures in China have had limited effect, as the profitability of most Chinese automakers has continued to deteriorate in the first half of the year.
Geely Automobile Holdings LtdGuidelines may restrict price competition abroad, but Geely's export surge is highlighted, creating mixed impact.
BYD Co Ltd Class AGuidelines aim to prevent price wars abroad, potentially limiting BYD's competitive pricing strategy, but export growth is noted.
