The Chinese government is growing increasingly frustrated with the manufacturers' price war.

KatadataOTO – Car manufacturers from China are competing for consumers in various countries. They are using all possible means.

Take for example the move of a price war. A number of manufacturers from China have been recorded slashing their product prices and offering discounts on a massive scale.

This has made the competition between manufacturers increasingly unhealthy. It has the potential to have a negative impact on the automotive industry there.

One of them is the threat of bankruptcy. Then there are the widespread layoffs (PHK) that are currently happening.

Photo : KatadataOTO

Based on the above, China's Ministry of Industry and Information Technology has tried to warn BYD, Geely, Chery, and other manufacturers not to continue the price war.

“Reckless price cuts can damage investment in research and development (of products),” said an official from MIIT (China Ministry of Industry and Information Technology) to Xinhua on Thursday (05/06).

In addition, discounts from manufacturers in China are also seen as potentially lowering the quality of their products and services. This could then lead to safety issues that are detrimental to consumer rights.

“There are no winners in a price war. Let alone a guaranteed future,” he continued.

MIIT will also strive to control detrimental competition in the automotive sector. One way is by encouraging improvements in the industrial structure and strengthening random inspections to maintain product quality.

Furthermore, they will also cooperate with relevant authorities in combating unfair competition and plan to create a regulation if deemed necessary.

The official also urged companies to improve their innovation, product quality, and services. And to fulfill their social responsibilities.