The statement in the pledge, "not to disrupt the fair competition order of the market with abnormal prices," was inappropriate and inconsistent with the principles of China's anti-monopoly law, the CAAM said.

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The China Association of Automobile Manufacturers (CAAM) organized 16 automakers to sign a pledge earlier this week to jointly maintain order in China's auto market, and the statement about prices in the pledge raised widespread discussion.

Now, the CAAM has announced that it has adjusted the pledge to remove the price-related statement to avoid misunderstandings.

On July 6, the CAAM organized a group of 16 car companies to issue a pledge to fulfill its responsibility to maintain fair competition in the market, according to a statement today.

However, the CAAM realized that the statement in the pledge, "not to disrupt the fair competition order of the market with abnormal prices," is inappropriate and inconsistent with the principles of China's anti-monopoly law, the statement said.

The CAAM announced that the price-related statement was removed from the commitment and urged the 16 car companies and other CAAM members to comply with the anti-monopoly law and other laws and regulations and to conduct their own pricing to compete fairly.

At the 2023 China Auto Forum held in Jiading, Shanghai on July 6, 16 major car companies, including Tesla, BYD, Nio, Xpeng and Li Auto, jointly signed the pledge.

The first line of the pledge reads, "We will abide by the rules and regulations of the industry, regulate marketing activities, maintain a fair competition order, and not disrupt the fair competition order of the market with abnormal prices."

The signing of the pledge comes in the wake of a price war at the beginning of the year and a war of words between several electric vehicle companies recently.

Since the beginning of March, a rare price war has erupted in China's auto industry, which has not boosted sales but has instead triggered a wait-and-see mood among consumers, resulting in car sales not seeing an increase.

On March 22, the CAAM called for the hype about price cuts in China's auto industry to cool down as soon as possible to return the industry to normal operation and ensure healthy and stable development of the industry throughout the year.

Since then, price wars in China's auto industry have gradually subsided, although some car companies have still offered purchase discounts from time to time due to their own business conditions.

The pledge is aimed at maintaining order in the auto market and promoting auto consumption, but could be seen as a request for car companies to avoid price cuts, which is clearly not feasible.

China is the world's largest auto market and the most competitive, and all car companies have the right to price their own models.

Following the signing of the pledge, Tesla yesterday ramped up referral incentives in China for the Model 3 and Model Y, while Volkswagen began offering big discounts in China for the ID. line of electric vehicles.

Carmakers, including Tesla, BYD, Nio, Xpeng, Li Auto, pledge to jointly maintain order in China auto market