EV Companies, Including Tesla, Move to End Price War in China

China’s top automakers and Tesla signed a joint agreement Thursday pledging to avoid "abnormal pricing," reports Bloomberg, ending a messy sales war in the country that started when Tesla slashed prices on its vehicles last fall.  

The companies, which include BYD Co., Nio Inc., and Geely, participated in a signing ceremony at the China Auto Forum in Shanghai Thursday.

The pact is aimed at ending what became a fierce price war in the world's largest automobile market, starting last October when Tesla cut the prices on its vehicles. The China Passenger Car Association reported a 13 percent drop in sales of all cars in China during this year's first quarter, according to the outlet Yicai Global.

By January, the starting price for Tesla's Model 3 had fallen 13.5 percent to 299,900 yuan ($33,515), CNN reported. This prompted other automakers to make their own price cuts, some as deep as 18 percent, and offer rebates of up to $3,000 dollars, The New York Times reported in April.

Angry customers who missed out on the lower prices flooded Tesla showrooms in January demanding refunds, according to Reuters, and about 200 people protested the price cuts at a Tesla delivery center in Shanghai.

The automobile companies signed a non-binding letter pledging “not disrupt fair competition with abnormal pricing” and “not exaggerate or use false publicity to attract or gain new customers,” according to Bloomberg.