VW, Nissan, Mercedes-Benz are probing claims made by Chinese investigative show

Article by Andrew Christian, on March 21, 2015

Carmakers like Volkswagen AG, Nissan Motor Co. and Mercedes Benz are investigating allegations brought in an investigative TV special in China that they were overselling repairs and spare parts to drivers. The show, "3.15", is an annual "3.15" consumer rights day investigative special aired by the China Central Television (CCTV).

Such reports could harm the carmakers’ image and affect sales. Volkswagen China spokeswoman Larissa Braun remarked that the German carmaker has paid close attention to CCTV reporting, asking for apology for any inconvenience caused to its customers. Nissan’s joint venture in China remarked that it would establish a team to probe the allegations and would boost regulation of its service teams.

Mercedes, meanwhile, announced a probe and urged its dealers to reform their behavior. Mercedes and Jaguar Land Rover are currently being probed by Chinese authorities for alleged anti-competitive behavior. Authorities have fined the Chinese venture of Volkswagen in 2014 for price-fixing. Land Rover has already issued an apology on its official microblog, adding that it was working to resolve the issue.

Among the companies that the show targeted in the past included camera maker Nikon Corp., fast-food chain Xiabuxiabu, fast-food giant McDonald's Corp., supermarket chain Carrefour SA and home products firm Procter & Gamble Co. Some companies have even given cut-price deals to consumers in the run-up the event just to win over them the show feature in them.

While CCTV has also be criticized in the past years with consumers defending its targets, marketing experts said sans damage control, the impact of such shows could damage companies severely. James Feldkamp, chief executive of consumer watchdog MingJian, remarked that the show still “packs a punch” to the firms targeted, adding that a poor response can evoke consumer outrage.

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