Involution (Economic term)
Why it matters?
Chinese EV sector is plagued with involution. Rivals indulging in price wars to capture market share amid oversupply are pushing firms into losses, a trend worsened by U.S., EU, Turkiye, and Mexico tariffs.
What you should know?
Involution: Process in which rivals in certain sectors indulge in price wars, attempting to capture market share and clear out oversupply of goods.
Involution is derived from the Latin phrase involution-em, meaning ‘to turn inwards.’
The Chinese term for involution, "neijuan", began trending online in 2020 and was initially used by young people to describe the hypercompetitive and often self-defeating pursuit of traditional markers of success.