China's Ministry of Industry and Information Technology announced that it was launching a campaign against false marketing and other fraudulent activities in the domestic automotive industry.

The ministry, along with five other government agencies, announced it would be launching a three-month campaign to curb such activities in the domestic auto sector, Reuters reported on Wednesday.

The statement outlined that the campaign would target behaviors such as false advertising, illegal profit-making and malicious defamation. The ministry also said it would make efforts to curb online trolling targeted at rivals, the report said

The ministry also said automakers and online platforms would need to self-regulate and undertake measures to rectify the issues outlined by the ministry in the statement.

The news comes after Beijing had condemned the fierce competition in the domestic auto industry driven by discounts, which was called the “EV price War” earlier this year.  The government had also said that it would regulate what it called a phenomenon of “irrational competition” in China among automakers.

Chinese EV giant BYD Co. Ltd. BYDDY BYDDF, meanwhile, announced it experienced a 30% decline in profits owing to the EV price war and also cut its annual sales target for 2025 by 16% from 5.5 million to 4.6 million units.

Elsewhere, Tesla Inc.'s TSLA sales in China have improved as the company recently recorded 13.4k new registrations in the first week of September.

Tesla has also reportedly run out of inventory for the company's six-seater Model Y L SUV through October, as the crossover registered over 120,000 orders since its launch. Xpeng Inc. XPEV, on the other hand, launched its Tesla Model 3 sedan rival, the P7 sedan, available for $30,000 in the Chinese market.

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