SHANGHAI--Chinese authorities fined Daimler AG's Mercedes-Benz
350 million yuan, or about $56 million, in the latest pushback
against foreign auto makers in the world's largest car market.
The fine is small compared with Daimler's overall business in
the country--last year Mercedes-Benz cars generated more in revenue
on average from the broader Asia region in a single day. Still, it
marks the increasing scrutiny foreign car makers and other global
companies are facing in China as antimonopoly investigators step up
their vigilance.
"Mercedes-Benz China accepts the decision and takes its
responsibilities under competition law very seriously. We have
taken all appropriate steps to ensure to fully comply with the
law," a Daimler spokesman said.
Price regulators in the eastern Chinese province of Jiangsu said
in a statement Thursday that they found Mercedes had colluded with
its dealers on prices of E- and S-class cars as well as of some
spare parts. Some Mercedes dealers in Jiangsu were fined a combined
7.9 million yuan, said the regulator, without specifying which
dealers.
It said the fine against Mercedes was equivalent to 7% of its
revenue in the province last year. Authorities in China can levy
fines of as much as 10% of a company's sales for the preceding
year.
The practices "excluded and limited market competition and hurt
consumer interests," the regulator said in a statement.
The announcement on Thursday came after a broad investigation
into foreign auto makers in China by antitrust officials last year,
mainly for the way they sell spare parts and aftermarket services.
State-run media has also accused many of the companies of making
exorbitant profits from Chinese buyers. Many foreign luxury car
makers cut the prices of cars, spare parts and aftermarket services
last year.
In September, local price regulators in China levied a total of
280 million yuan in fines against Audi AG and Chrysler for
allegedly overcharging Chinese consumers for cars and after-sales
services. In August, the National Development and Reform
Commission, China's top economic planner, slapped a 1.24 billion
yuan combined fine against 10 Japanese auto-parts and bearings
makers for antitrust activities.
In addition to foreign car makers, China has imposed fines on a
variety of multinational companies ranging from pharmaceutical
producers to eyeglass and contact-lens makers. In recent months,
the authorities have been intensifying scrutiny over foreign
technology companies.
Foreign companies have an overwhelming share of the luxury car
market in China. Mercedes-Benz, BMW AG and Audi have a combined 72%
of the market, according to an estimate by consulting firm
Strategy&. China has become an increasingly important area for
Daimler, accounting for about 10% of its revenue last year.
Daimler's China revenue last year totaled EUR13.29 billion, up 24%
from 2013.
Daimler doesn't break out its revenue from Mercedes-Benz cars in
China. The Mercedes-Benz car brand in Asia generated EUR22.39
billion in revenue last year. China is the largest single market
for the Mercedes-Benz brand in the region.
Rose Yu
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