China: The State Administration for Market Regulation has banned the sale of vehicles below the total production cost

The State Administration for Market Regulation in China has published a set of directives that prohibit car manufacturers from selling vehicles below the total production cost, including manufacturing, administrative, financial, and general sales expenses.

This measure aims to stop a price war that has affected the industry, favoring large manufacturers such as BYD Co. and Tesla, while putting smaller companies at risk. Authorities have also banned price fixing between manufacturers and suppliers, as well as pressuring dealers to make deficit sales. Additionally, the China Passenger Car Association reported a 13.9% decrease in retail sales of passenger vehicles in January, with a significant drop in electric vehicles. Despite regulatory efforts, the auto market in China continues to be marked by price reductions.