BEIJING: China has introduced a new plan aimed at stabilizing its auto industry, which is currently facing challenges from intense price competition and export difficulties, according to state media reports.
The strategy, rolled out by eight different government departments, outlines measures for 2025 and 2026. It emphasizes the importance of monitoring costs and prices while promoting innovation and boosting domestic demand, as detailed by the Xinhua news agency.
The plan anticipates that total vehicle sales will reach about 32.3 million this year, reflecting a modest growth of 3%. This is a decrease compared to the 4.5% growth seen in 2024, as reported by the China Association of Automobile Manufacturers.
In recent years, Beijing has made significant investments to advance its electric vehicle sector. The new plan targets a 20% year-on-year growth in new energy vehicles, aiming for around 15.5 million units by 2025.
However, the market is currently experiencing a price war, which has driven several startups out of business as companies flood the market with affordable vehicles and trade-in offers.
During a meeting in July, officials urged an end to “irrational competition,” advocating instead for healthier development within the industry. Additionally, China’s export market is under pressure, notably with the European Union launching an investigation into suspected unfair practices in the automotive sector.
Compounding these issues, Mexico recently proposed increasing its duty on car imports from China to 50%, up from the previous rates of 15-20%, which has drawn criticism from Beijing.
