China Intensifies Crackdown on Tech Firms’ Price Wars Amid Deflation Concerns
Beijing is escalating its scrutiny of Chinese tech companies engaging in aggressive pricing strategies to capture market share. The State Administration for Market Regulation (SAMR) has shifted from a post-2021 enforcement lull to targeted investigations, now focusing on travel giant Ctrip following earlier probes into Meituan and Alibaba's delivery units.
Regulators aim to curb 'involution'—a destructive cycle of unsustainable discounting that plagues industries from e-commerce to electric vehicles. Trip.com, Ctrip's Hong Kong-listed parent, saw shares plummet 20% this week despite assurances of normal operations during the probe.
The crackdown reflects broader economic anxieties as China battles persistent deflation, with consumer prices declining for over three consecutive years. SAMR's renewed vigor signals a strategic pivot from recovery-era leniency to active market intervention.
