China tells carmakers, suppliers to avoid price wars abroad to pave way for healthy growth

Beijing has instructed Chinese automakers and component suppliers to cease offering aggressive discounts in overseas markets while expanding globally, according to a statement from the Ministry of Commerce. For the first time, three ministry-level authorities have released regulations for Chinese carmakers operating abroad, with the aim of enhancing their global competitiveness, the statement said.

The guidelines, jointly released on Tuesday by the commerce ministry, the Ministry of Industry and Information Technology, and the State Administration for Market Regulation, seek to foster long-term, healthy growth for the Chinese automotive industry in international markets. They urge companies to adhere to regulations and leverage international influence to foster cooperation in the global automotive industry and supply chain.

However, the guidelines do not outline penalties for non-compliance. The move comes after initial indications that Chinese automakers may engage in price wars abroad, prompting regulators to intervene. Gao Shen, an independent analyst, noted that signs of potential aggressive discounting have prompted regulators to step in to prevent a vicious cycle of competition that could undermine sustainable growth and profitability.

Chinese carmakers have been ramping up overseas expansion over the past two years, with electric vehicle exports to over 200 international markets surging and local production increasing. In the first seven months of 2027, Chinese automakers delivered 2.9 million electric vehicles abroad, a 120% increase from the previous year, according to data from the China Association of Automobile Manufacturers.