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Business / Auto Policy

Mercedes-Benz fined $56.5m for price fixing

By HAO YAN (China Daily) Updated: 2015-04-24 07:36

Mercedes-Benz fined $56.5m for price fixing

Visitors at the stand of Daimler AG's Mercedes-Benz at the Shanghai Auto Show on Thursday. The German luxury carmaker was fined 350 million yuan ($56.5 million) for price fixing. [Photo/China Daily]

Mercedes-Benz, a division of the German automobile manufacturer Daimler AG has been fined 350 million yuan ($56.5 million) for price fixing, the Jiangsu Provincial Price Bureau announced on Wednesday.

Several Mercedes-Benz dealerships were fined 7.87 million yuan.

After ongoing investigations since August, the bureau said that from January 2013 to July 2014, the auto giant forced the floor prices of its E-Class and S-Class cars on dealers, in violation of China's Anti-Monopoly Law.

The local government fined Mercedes-Benz and several dealerships in Nanjing, Suzhou and Wuxi for monopolistic practices involving vehicle and auto parts sales.

The penalty on Mercedes-Benz is 7 percent of the company's sales revenue last year from the two models in the region. The dealers were fined 1 percent of sales. The price bureau mitigated or waived fines against some suspected dealers for their cooperation during the investigations.

Beijing Mercedes-Benz Sales Service Co said in a statement it "fully respects and accepts the findings and punishment decision, and will comply immediately".

"Having drawn important lessons from this, we will ensure strict compliance with relevant laws, strengthening the legal and regulatory controls within our company, dealer network, and various business divisions to resolutely ensure that these issues do not arise again," it said in a statement.

A report jointly released by the China Automotive Maintenance and Repair Trade Association and Insurance Association of China in April 2014 found replacement parts for Mercedes-Benz C-Class vehicles had cost 3.72 million yuan, 12 times that of the car's starting price of about 310,000 yuan.

Jia Xinguang, a senior analyst with the China Automobile Dealers Association, said it would have been easy for several dealerships from one region to manipulate market prices, as long as they acted together.

"Price fixing has existed widely, but was rarely looked into in the past.

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