China has issued new guidelines through its commerce and industry ministries, along with its market regulator, instructing automakers to focus on costs and market demand when pricing their vehicles abroad. The guidelines advise manufacturers to set clear price tiers based on vehicle configurations, avoid frequent steep price changes, and respect the pricing autonomy of local dealers.
These regulations come in response to the growing concern about China’s automotive exports, which reached 8.32 million vehicles in 2025, including 2.77 million new energy passenger cars in just the first seven months of this year. The European Union, which has imposed countervailing duties on Chinese electric vehicles, is the key market of concern. The EU implemented duties ranging from 7.8% to 35.3% in October 2024 and has been trying to negotiate a minimum import price since.
Beijing’s guidelines resonate with the EU’s efforts, emphasizing a cost-based pricing strategy instead of undercutting. This position faces political challenges within the EU, particularly from countries like Germany and Hungary, which oppose the tariffs due to their ties with Chinese investments.
While the guidelines are meant to ensure compliance with host country laws and international rules, they lack specific penalties for non-compliance, raising questions about their enforceability. These developments take place amidst rising electric vehicle sales in Europe, which reached a 25% market share as of July, highlighting the ongoing evolution in the automotive industry landscape.
