BEIJING, May 31 (Xinhua) -- In a significant announcement, China's Ministry of Industry and Information Technology (MIIT) pledged to intensify efforts against what it termed 'involution-style' competition in the country's automotive sector. This initiative is aimed at strengthening oversight and ensuring a fair and orderly market environment amid increasing challenges posed by disorganized competitive practices.

The MIIT's statement follows an initiative put forth by the China Association of Automobile Manufacturers (CAAM), urging all industry players to uphold fair competition and nurture healthy growth within the sector. This call to action comes at a critical time, as the automotive landscape in China experiences transformative changes.

According to an MIIT official, the ministry fully supports CAAM's proposal, while also highlighting that recent chaotic price wars have severely disrupted normal business operations. These price-cutting practices are jeopardizing the industry's long-term health and sustainability, creating an environment that is increasingly difficult for manufacturers to navigate.

Emphasizing the ministry's stance, the official stated that while organizations are encouraged to reduce production costs via innovative technologies and better management to offer high-quality and cost-effective products, reckless price slashing endangers investments in research and development. Furthermore, it can lead to compromised product quality and safety concerns that ultimately jeopardize consumer rights.

The official articulated that such a competitive landscape exemplifies involution, predicting that it could gradually diminish the momentum necessary for the industry's progress. The stark warning was clear: 'There are no winners in a price war, nor is there any future,' indicating the urgent need for change.

In response to the rising disorder, the MIIT outlined a plan to rein in involution-style competition within the automotive sector. Key measures will include promoting upgrades in industrial structure, enhancing random inspections for product consistency, and collaborating with relevant authorities to combat unfair competitive practices.

The call for collaboration extends to automakers, who are urged to enhance their innovation capabilities, improve product and service quality, and take their social responsibilities seriously. These efforts are seen as vital for creating a sustainable competitive environment.

Moreover, the CAAM has previously emphasized the importance of safeguarding fair competition in the rapidly expanding new energy vehicle (NEV) market. With NEVs now representing over 40 percent of new car sales in China, the initiative comes at a crucial juncture as the industry faces profitability challenges arising from fierce competition.

Recent drastic price reductions initiated by leading car manufacturers have triggered market apprehensions, prompting calls for all companies to adhere strictly to fair competition principles. The CAAM stressed that larger enterprises should not attempt to monopolize the market at the expense of their competitors.

The message from CAAM was unequivocal: businesses must avoid selling products below cost or engaging in misleading marketing tactics that disrupt market order, thereby safeguarding the fundamental interests of the industry and its consumers. Moving forward, maintaining a fair competitive landscape will be critical as the automotive sector navigates its ongoing evolution.