Chinese authorities recently called upon the country’s new energy vehicle (NEV) makers to step up efforts to ensure the reliability of their vehicles and ordered enhanced inspections against the backdrop of a relentless price war across the industry that has raised concerns about quality issues.
Why it matters: Beijing’s warning is the latest sign of growing regulatory scrutiny of the Chinese electric vehicle market. It comes after Great Wall Motor’s chairman publicly questioned the quality of heavily discounted EVs in the market and voiced concerns over a two-year-long price war that has affected the entire supply chain.
Details: Three Chinese government bodies on June 19 warned local automakers to “cherish the remarkable achievements” in the development of the country’s NEV industry and “never compromise” the safety of their products for cost reductions in the short term (our translation).
- China’s Ministry of Industry and Information Technology (MIIT), the State Administration of Market Regulation (SAMR), and the National Fire and Rescue Administration, will jointly carry out inspections on product consistency and verify the quality of their products, according to a statement published by MIIT (in Chinese).
Context: The news comes after the MIIT said earlier this month that it will increase monitoring of “vehicle models that have attracted significant public attention or present considerable quality and safety risks” and impose penalties on those found to be noncompliant with national standards.
- Beijing has tightened its regulation of China’s fast-growing EV industry, with the announcement in April of a ban on automakers using the term “smart driving” when they advertise intelligent driving features and invite owners to test their vehicles via remote software updates, Reuters reported. The move came after a severe crash involving a Xiaomi SU7 sedan sparked fresh public outcry over vehicle safety.
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