The association does not really have the right to speak. The auto industry's self-discipline is a chaos.
In recent developments, the Beijing Market Association has introduced self-regulation guidelines for the automotive industry. These regulations specifically target four common unfair competition practices in car sales: falsely promoting one's own brand, spreading false information to harm competitors, securing market share through bribes or rebates, and making significant price cuts. Additionally, unauthorized use of registered trademarks under the name of official dealers is also prohibited. Following the release of these guidelines, industry insiders have expressed mixed opinions, with some suggesting that the issue of price competition in the auto market should be the first topic for discussion.
As an editor, I must say that if I hadn’t seen this news, I wouldn’t have known there was still a Beijing Market Association. It’s impressive that they’ve developed specific rules for car sales, which shows growing attention on the automotive sector. However, the real question is: how effective can an industry association’s “self-regulation†really be?
Looking at the content of the guidelines, it’s clear there are many loopholes. One provision states that “automobiles cannot be sold at significantly reduced prices based on public quotations.†This seems aimed directly at dealers, who have long been known for arbitrarily lowering prices to compete. In response, automakers have organized various pricing alliances. Yet, despite these efforts, car prices continue to fluctuate rapidly, and no one has managed to truly control the situation.
The power of a market association that claims to regulate without real authority is questionable. The problem isn’t new — car sales have always had price inconsistencies, and the so-called “unregulated behaviors†mentioned in the guidelines have existed for years. In the past, when cars were scarce, people needed connections to buy one. Later, as dealers emerged, their status was unclear and hard to regulate. Even in the 1990s, when the Beijing Asian Games Village became a major car trading hub, many of the issues now being regulated were minor and not necessarily in need of formal oversight.
With the rise of franchised 4S stores in recent years, the car business has become highly profitable. Dealers often invest millions, and the industry is seen as a lucrative opportunity. Now, the Beijing Market Association has issued this regulation, claiming that violations will result in media exposure or inclusion in a credit warning system. For a business owner, having negative publicity from a supposedly “fair†association could be damaging. As a result, dealers may feel forced to comply — or at least appear to — to avoid reputational harm.
Objectively speaking, some car dealers do engage in unethical behavior that harms consumers, and there are certainly unscrupulous actors in the market. The introduction of self-regulatory norms by industry associations can help create a fairer environment, which is a positive step. However, some of the provisions in the guidelines seem outdated and unrealistic. One media report even claimed that this new regulation would end substantial price cuts — a bold statement if true.
If the association can’t actually control the market, then it shouldn’t make such grand claims. The car sales market is already complicated enough — let’s not add more confusion. (Wu Weiqiang)
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