China to punish Audi, Chrysler for monopolistic practices

Stepping up pressure on foreign carmakers in the world's biggest auto market, China today said it will punish auto giants Chrysler and Audi for monopolistic practices, a move that could attract a fine of up to 10 per cent of their domestic annual sales revenue.
Separate anti-trust probes into Chrysler and Audi, conducted since late 2011 alongside similar investigations into other players in the auto sector are drawing to an end, Li Pumin, spokesman for the National Development and Reform Commission (NDRC) said without specifying punishments.
Chrysler was investigated by the Shanghai Municipal Development and Reform Commission and Audi by the Hubei Province Price Bureau.

Probes into 12 Japanese companies have also been completed, finding monopolistic behaviour on prices of auto parts, and they will be punished in accordance with the law, Li was quoted by the state-run Xinhua news agency as saying.
He confirmed reports that the Jiangsu Province Price Bureau separately launched an anti-trust investigation last week into Mercedes-Benz dealers in five Jiangsu cities.
Inspectors from the bureau and the Shanghai Municipal Development and Reform Commission on Monday visited Mercedes-Benz's Shanghai premises.

Inspectors are still collecting evidence and investigating whether the German car giant has used monopolistic tactics, the spokesman said.
The NDRC launched anti-monopoly probes into the auto sector at the end of 2011 to safeguard competition in the market and protect customer rights.

If a firm manipulates prices by controlling production, distribution and sales of a product, it violates the Anti-Monopoly Law, which came into force in 2008.
According to the Anti-Monopoly Law of China, enterprises which have been involved in a monopoly may be fined between one and 10 per cent of their total sales of the previous year.
Many auto makers, especially luxury brands, have announced price cuts in the past two weeks.
The latest such move was made by Chrysler's China unit, which yesterday announced a 20 per cent-price cut for 145 spare parts, a 650,000-yuan (USD 106,500) reduction for its Jeep Grand Cherokee SRT8 model and a 450,000-yuan cut for its 5.7 litre Grand Cherokee.

The company claimed the price cuts were made to reward Chinese consumers for their loyalty and to respond "positively" to the NDRC's anti-monopoly probes.