In the midst of China’s automotive market facing downward economic trends and intense competition, some car manufacturers have fallen into a spiral of internal competition and price wars, resorting to irregular competitive methods to boost sales, even leading to the emergence of a chaotic phenomenon of “zero-kilometer second-hand cars.” Geely Holding Group Chairman Li Shufu recently criticized the industry for its internal competition and irregular practices at a car forum, pointing out that some companies are using “unspeakable” means to disrupt market order.
At the closing plenary session of the 2025 China Auto Forum in Chongqing, Li Shufu, through a video speech, sharply criticized the irregularities in China’s automotive industry competition.
He emphasized that there are numerous irregularities in the competition in the Chinese automotive industry, with some companies using “unspeakable” means that severely damage market order and industry ecology.
Li Shufu stressed, “A car is just a car, whether it’s ‘overtaking on a bend’ or ‘changing lanes’, it must operate on a legal and compliant track.” He bluntly stated, “Telling lies is hard to justify, and doing unethical things goes against moral principles.”
Discussing the current industry situation, he stated that the Chinese automotive industry is at a crucial development stage. Despite a relatively low overall export share, competition in the domestic market is intensifying. He called on the entire industry to abandon speculative and opportunistic attitudes.
Reflecting on last year’s China Auto Forum in Chongqing, Li Shufu previously analyzed the issue of price wars in the Chinese car market. At that time, he stated that the level of internal competition in China’s automotive industry ranks first globally, and the range and intensity of price wars are unprecedented.
Li Shufu analyzed that unchecked internal competition and blunt price wars will inevitably lead to cut corners, counterfeiting, and other illegal activities, leading to disordered competition.
In recent years, the Chinese automotive market has been in crisis due to economic downturns and intensified competition, with many car companies continuously engaging in price wars to boost sales. Some markets have even seen the emergence of the phenomenon of “zero-kilometer second-hand cars.” This involves newly registered cars quickly being sold as second-hand cars to create a “hot-selling” illusion, misleading consumers.
Great Wall Motors Chairman Wei Jianjun recently warned about this phenomenon in an interview with the media, pointing out that the “zero-kilometer second-hand car” chaos has spread to multiple trading platforms, involving thousands of dealerships. He further revealed that some heavily indebted car companies are using this method to conceal operational risks, indirectly indicating a potential crisis similar to “The Evergrande of the Auto Industry” with debts exceeding 584.7 billion yuan at BYD.
BYD Brand General Manager Li Yunfei responded through social media, counterattacking with cryptic language, sparking widespread attention. Following the escalation of the situation, the Chinese Ministry of Commerce urgently convened a closed-door meeting with relevant companies in an attempt to quell the controversy.
However, automotive industry researcher Yang Jigang analyzed that the root of the “zero-kilometer second-hand car” issue lies in the unequal division of responsibility between manufacturers and dealers, as well as the excessive pursuit of sales volume data. He pointed out that while government intervention may temporarily alleviate conflicts, it cannot fundamentally solve the problem.
According to data from the China Passenger Car Association, in the first five months of 2024, the scale of price cuts in the Chinese auto market exceeded 90% of the total for the entire year of 2023, with new energy vehicles generally in a state of loss-making sales. While the continued price wars stimulate short-term sales, they further exacerbate industry internal competition, squeeze car manufacturers’ profit margins, and threaten the long-term stability of the industry chain.