Tesla and 15 Chinese automakers have pledged to maintain fair competition and avoid “abnormal pricing” in the world's largest electric vehicle market. The signing of the agreement was initiated by the Ministry of Industry and Information Technology of China.
Executives from 15 Chinese companies and Tesla, which is the only foreign brand, attended the Fair Competition Pledge signing ceremony. It took place at the China Automotive Forum in Shanghai on Thursday, according to BNN Bloomberg. Manufacturers are committed to the four items set out in the commitment. These included BYD Co., Nio Inc., Xpeng Inc., Geely and Chery Automobile Co., Tesla, and others.
The details of the agreement, which is non-binding:
- Adhere to industry rules and regulations, regulate marketing activities, maintain fair competition and not disrupt fair competition with abnormal pricing
- Pay attention to marketing and publicity methods, not exaggerate or use false publicity to attract attention or gain new customers
- Put quality first, improve lives with high-quality products and services
- Promote core socialist values, actively fulfill social responsibilities, and take on the heavy responsibility of maintaining steady growth, strengthening confidence and preventing risks
Tesla began aggressively cutting the price of its vehicles in China at the beginning of this year. In difficult economic conditions, the company began to fight for consumers and achieved success in this. This prompted some other big brands to also launch big discounts as their sales slowed down.
The effects of COVID-19, as well as the fact that consumers expected a further fall in car prices, caused a slowdown in sales in the automotive sector. This has exacerbated concerns within the government, which is pushing for wider adoption of electric vehicles. The Ministry of Industry and Information Technology instructed the China Association of Automobile Manufacturers to bring together 16 companies to sign the pact, Communist Party official Miao Wei said at Thursday’s event.
“The agreement comes at a time when the price war is already at the point of pause,” China Passenger Car Association Secretary General Cui Dongshu said.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.