China is addressing price wars in EV industry to stabilize market, BYD sees sales growth

The Chinese government is taking action against fierce competition in the electric car market, as oversupply and price wars threaten industry stability. Market leader BYD saw a 31% sales growth, but criticism arose over its price cuts. Chinese automakers are looking abroad for profits as tariffs on made-in-China electric vehicles are imposed by the U.S. and EU.

BYD’s price cuts sparked concerns about industry health, drawing comparisons to Evergrande’s collapse. The government and industry association called for fair competition and healthy development. A pledge by 17 automakers, including BYD, to pay suppliers within 60 days aims to combat involution-style competition and reduce financial pressure.

Efforts to reverse downward price expectations include speeding up payments, rolling back financing offers, and calling for fair competition. Analysts are monitoring the effectiveness of these measures in reversing the price trend and their impact on EV demand in the coming quarters.

Read more at Yahoo Finance: China shows signs of tackling the price wars that are taking a toll on its EV industry