China's Auto Industry Faces Overcapacity and Price War

Imagine the car industry is like a giant bakery that can make lots of bread, but isn't making as much as it could.

In China, car factories can make way more cars than people are buying.

This means many factories are not using all their space.

Because they aren't selling enough cars, companies have to lower their prices to get people to buy them.

This could lead to a price war where companies try to sell their cars for less money.

Some companies might close down if they can't make a profit.

Big car companies like BYD and Tesla are doing better because they sell many cars.