Chinese automaker BYD has implemented salary increases for its research and development staff, becoming the latest major company to lift pay as China steps up efforts to rein in excessive competition and stimulate domestic consumption.
Reports of the pay rises were confirmed by BYD, according to a report on Wednesday by local financial media outlet Cailian. Market speculation suggested most employees received monthly increases of between 500 yuan ($71) and 1,000 yuan, while a smaller group saw raises of 2,000 to 3,000 yuan. BYD did not comment on specific amounts, Cailian said.
BYD operates two annual salary adjustment windows and one promotion cycle each year, according to the report. Founded in 1995, the company has expanded into one of China’s largest automakers, employing more than 900,000 people, including nearly 110,000 R&D personnel.
The move follows a recent pay adjustment by battery giant CATL, which earlier this month said it would raise monthly base salaries for production workers by 150 yuan from Jan. 1, 2026. CATL had 131,988 employees at the end of 2024, including 96,725 frontline production workers.
The wage increases come as Chinese authorities seek to address what they describe as excessive competition across industries, particularly in the electric vehicle sector, while encouraging higher household spending. Intense price wars among automakers in recent years have squeezed margins and heightened concerns about sustainability, a phenomenon commonly referred to in China as “involution.”
“The primary cause of involution is dominant companies pursuing excessive competition,” said Dong Yang, former executive vice-chairman of the China Association of Automobile Manufacturers, in a commentary published on WeChat on Wednesday. If companies focus solely on their own growth while ignoring the interests of the broader supply chain or industry order, that constitutes involution, he wrote.
Dong said that efforts to govern involution were among the most significant developments shaping China’s auto industry in 2025, underscoring the policy backdrop against which companies such as BYD and CATL are adjusting labour practices.
