China‘s market watchdog on Thursday released guidelines for the auto industry aimed at regulating pricing behaviour, curbing price wars and preventing unfair competition.
The guidelines from the State Administration for Market Regulation apply to car makers, part suppliers and dealers involved in car production and new vehicle sales in China.
They target practices including failure to display prices as required and deceptive promotions, while encouraging sales platforms to alert consumers to potential risk associated with “significantly low-priced” offers.
“The guideline promotes orderly competition and rational development within the industry while advancing high-quality growth. It also plays a critical role in fostering and enhancing automotive brands,” said Cui Dongshu, secretary-general at the China Passenger Car Association.
China’s auto industry, the world’s largest, faces rising pressure as demand is expected to stagnate this year while a years-long price war hurts profitability.
Since early 2025, Chinese authorities have ramped up efforts on a so-called “anti-involution” campaign and pledged to put an end to aggressive price cuts. Regulators intensified crackdowns on alleged unfair pricing practices and misleading advertising, while raising safety standards for vehicle tests and batteries, intending to restore consumer confidence.
The regulatory moves have played a positive role in the auto industry, with losses decreasing significantly in the second half of 2025, according to Li Yanwei, an analyst with the China Automobile Dealers Association.
“The automotive market has officially transitioned from a ‘price war’ to a ‘value war,'” said Li.
