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China's electric vehicle market booms, but overcapacity and price wars threaten stability. The government attempts to curb excessive competition, but challenges remain.
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Why China Is Trying to Tame Its Electric Car Frenzy By Keith Bradsher Sept. 2, 2025Updated 10:03 a.m. ET China is conquering the world in electric vehicles. Its automakers produce far more than any other country and outpace them on innovation. Chinaβs appetite for gasoline-powered cars is fading by the week. In each of the last five months, battery-powered and plug-in hybrid cars made up more than half of all cars sold. But look closer at the industry and the picture is not pretty. Already, fierce competition among automakers has gotten ruthless, with about 50 automakers fighting for customers by slashing prices again and again. Manufacturers facing ruinous losses are struggling to pay the companies that supply their parts. And yet they keep borrowing from state-run banks to build more factories, leading to extensive overcapacity. The frenzy has captured the attention of the highest levels of Chinaβs government. Officials have started a campaign against βinvolution,β which they de...
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