The Chinese authorities are calling for restricting the sale of "new zero-mileage cars" as used vehicles.

The Chinese practice of selling brand new cars as heavily discounted used cars to clear inventory needs to be stopped, stated the official newspaper of the ruling Communist Party of China in an article published on Tuesday.

The People's Daily, which often reflects the positions of the top party leadership on various issues, called for limiting this practice, known as "zero-mileage cars," just weeks after the chairman of Great Wall Motor, Wei Jianjun, publicly condemned it, and the Chinese Ministry of Commerce met with Chinese automakers to discuss the problem.

While the Chinese Ministry of Commerce did not publicly state its position, the People's Daily takes a firm stance, stating that this "disguised price reduction disrupts the normal market order" and is a "glaring example of 'involution' in the auto industry" - a term popular in China that describes a race to the bottom driven by excessive competition.

The People's Daily warns that when the rules of market competition are properly applied, "zero-mileage cars" will not be able to go far or last long.

China is experiencing growing deflationary pressures, as US tariffs further dampen the mood in the world's second-largest economy. Companies from various sectors - from fast food to high fashion - are cutting prices due to concerns about oversupply and weak consumer demand.

Price wars have engulfed the Chinese auto industry in recent years, partly due to the decline in domestic consumption and overcapacity, leaving many manufacturers struggling to meet their sales targets.

Although the sale of zero-mileage cars is perceived by many Chinese automakers as an effective way to clear constantly growing inventories of unsold cars, with domestic and foreign consumers attracted by the deep discounts on still-brand-new vehicles, the state newspaper listed several negative effects of this practice.

The People's Daily noted that this sales tactic may help reduce inventory in the short term, but it compresses profit margins, increases losses, and hinders investments in product quality and innovation - ultimately harming sustainable development.

The newspaper warned that for consumers, what appears to be a good deal from a price perspective carries hidden risks: loss of benefits for the first owners, potential battery deterioration, and greater depreciation upon resale. It added that the practice undermines fair competition, distorts market data, and disrupts both the new and used car markets.

The People's Daily pointed to electric vehicle manufacturers as needing to move away from "data worship" and volume competition to focus on product quality and technological innovation. The newspaper did not specify any particular automakers.

The newspaper also listed measures that Chinese regulatory authorities should take to prevent the sale of zero-mileage cars as used, including strengthening supervision of used vehicle registration, creating a vehicle life cycle tracking system, and strict control over the practice of immediate resale after registration.