A Chinese industry body of automakers retracted a two-day-old pledge not to resort to “abnormal pricing practices,” earlier seen as an effort to end a bruising price war in the country’s electric-vehicle market.
The China Association of Automobile Manufacturers is deleting one of the four commitments signed on Thursday by 16 companies at an event it organized, which promised to refrain from practices that disrupt fair market competition, it said in a statement posted on its website on Saturday.
The reference to “pricing” in the pledge was inappropriate and in breach of a principle enshrined in the nation’s antitrust law, the association said. The retraction came after the clause drew “widespread attention,” according to the statement.
The association urged the 16 companies and other members to strictly follow the antitrust law and other rules that encourage independent pricing and fair competition.
Tesla Inc. Was the only foreign brand among the automakers that took part in the signing ceremony in Shanghai, committing to a four-point pledge. The companies also included BYD Co., Nio Inc., Xpeng Inc., Geely and Chery Automobile Co.,.
Austin, Texas-based Tesla started cutting prices in China late last year, prompting other major brands to join in with steep discounts in the earlier part of 2023 as sales slowed.
The lagged impact of Covid restrictions and expectations of further price cuts weakened car demand in the world’s second-largest economy. The government has started a campaign to promote EV adoption in rural areas, among other measures to lift the auto industry and wider consumption.