Mercedes-Benz is cooperating with Chinese anti-trust regulators over an investigation

Article by Christian A., on August 7, 2014

Mercedes-Benz is cooperating with the National Development and Reform Commission -- China's anti-monopoly authorities -- over a probe into unspecified matters. Local media have reported authorities have raided Mercedes’ Shanghai office. Mercedes confirmed that it is assisting the authorities in the probe.

Mercedes-Benz spokesman Senol Bayrak said the carmaker is only confirming that officials from the antitrust agency visited the Shanghai office as part of a probe. Shanghai-based paper Jie Mian reported that nine officials from the agency’s antitrust investigation team made a surprise visit at the carmaker’s office in the city.

Jie Mian reported that the team interviewed several senior executives and even confiscated computers as part of a probe. Prior to the raid, Mercedes disclosed it would drop prices on over 10,000 spare parts by an average of 15 percent. It followed a similar cut in prices for repair and maintenance services disclosed in July.

The German luxury carmaker is the latest foreign company being targeted by the NDRC, who have launched anti-monopoly produced in industries like pharmaceuticals and electronics. NDRC has labeled US chipmaker Qualcomm a monopoly in July and is expected to impose a heavy fine. NDRC also raided Microsoft's offices in four Chinese cities as part of a current probe.

The raids and probes come as China enforces an anti-monopoly law enacted in 2008. It had already imposed substantial fines to some multinational companies like Mead Johnson Nutrition Co. and Danone.

In response to an anti-monopoly investigation" by NDRC into the auto industry, Mercedes-Benz said that it is planning to trim the prices of over 10,000 spare parts in China by an average of 15 percent starting September 2014.

In a statement, Marc-Oliver Nandy, executive vice president of aftersales for Mercedes in China, said that the price cut "would further lower the usage cost” for its customers. He added that the price cut also improve the Mercedes’ competitiveness in the after-sales market.

The carmaker recently said it would trim service charges and corresponding spare part prices. Audi has also decided to lower the prices of spare components and aftersales services in China.

Jaguar Land Rover also slashed the prices of its three models -- Ranger Rover 5.0 V8, Ranger Rover Sport 5.0 V8 and Jaguar F-Type Cabriolet -- in China following the launch of NDRC’s anti-monopoly probe.

On August 1, 2014, the Ranger Rover 5.0 V8, Ranger Rover Sport 5.0 V8 and Jaguar F-Type Cabriolet saw their prices slashed by an average of CHY200,000 ($32,300). In a statement, Jaguar Land Rover said that because of the importance of China, it is setting up a process to review its pricing, deciding to voluntarily cut the price of the models.

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Topics: mercedes-benz, china

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