AsianFin -- China's Ministry of Industry and Information Technology (MIIT) said Saturday it will intensify efforts to tackle "involution-style" competition in the country's auto industry, vowing to strengthen oversight and safeguard a fair and orderly market environment.
The announcement came after the China Association of Automobile Manufacturers (CAAM) launched an initiative calling on companies to maintain fair competition and foster healthy industry growth.
In response, the MIIT voiced support for the proposal and warned that recent disorderly price wars have significantly disrupted normal business operations and posed a threat to the industry's healthy and sustainable development, according to an official with the ministry.
Noting that while the ministry encourages enterprises to reduce production costs through technological and managerial innovation and deliver higher-quality and cost-effective products to consumers, the official stressed that disorderly price cuts undermine research and development investment, erode product and service quality, and may even lead to safety issues that harm consumer rights.
Such competition is a classic case of involution, the official said, adding that it will only weaken the momentum for industry development over time. "There are no winners in a price war, nor is there any future," the official warned.
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