China issues conduct guidelines for automakers amid EV market dominance

China is implementing new regulatory measures and experiencing a massive shift in its domestic automotive market. The Chinese government, through the Ministry of Commerce, the Ministry of Industry and Information Technology (MIIT), and the State Administration for Market Regulation (SAMR), has released the ‘Guidelines for Overseas Competitive Behavior and the Establishment of Compliance in the Automotive Industry’. This code of conduct aims to prevent Chinese automakers from exporting aggressive domestic practices, such as price wars and heavy discounting, to international markets. The guidelines encourage pricing based on costs and market supply and demand to protect brand image and ensure healthy global expansion.

Simultaneously, China's domestic market has become almost exclusively dominated by electric vehicles (EVs). In August 2026, all ten of the best-selling car models in China were fully electric. Local manufacturers are leading this surge, with the Geely Xingyuan taking the top spot, followed by the Leapmotor A10 and the Tesla Model Y. This dominance of domestic EV brands poses significant challenges for Western manufacturers, as local models often benefit from highly competitive pricing.