An official from China's Ministry of Industry and Information Technology (MIIT) said at the 2023 China Auto Forum in Shanghai on July 6 that participants in the country's auto industry should not compete with abnormal prices, according to a report on state broadcaster CCTV.

So far this year, the Chinese auto industry has seen the largest wave of price cuts in its history, including more than 100 models from more than 30 brands, some at any cost.

In response to the phenomenon, the MIIT source said that the development of China's auto industry has entered a new phase, with new energy vehicles (NEVs) forming a certain lead and auto companies should regulate their marketing activities.

Auto industry players should not disrupt fair competition with abnormal prices and should avoid reckless price cuts, while strengthening technological innovation and improving product quality.

The China Association of Automobile Manufacturers (CAAM) and 16 major automakers jointly signed a pledge to maintain fair market order in the auto industry. The 16 car companies include BYD, Nio, Li Auto, Xpeng, Tesla, SAIC, Geely and Great Wall Motor, who pledged to maintain a fair competition order and not to disrupt the order in the market with abnormal prices.

The initiative is just the beginning, and further restraint on bad behavior, including malicious price cuts, will depend on self-regulation and regulatory means, Fu Bingfeng, executive vice-president and secretary general of the CAAM, was quoted by CCTV in the report.