ECONOMY

China fines Ford joint venture, citing anti-monopoly law

The fine amounted to four percent on the company’s sales value in Chongqing in 2018, the regulator said. (AP)

China on Tuesday imposed a $23.6 million fine on US automaker Ford’s joint venture for “price fixing” in violation of anti-monopoly laws, a move coinciding with growing trade tensions with the United States.

Changan Ford Motor Co. “set a minimum resale price” since 2013 for vehicles sold in the southwestern city of Chongqing that “deprived dealers of pricing autonomy... and damaged fair competition and legitimate interests of consumers,” the State Administration for Market Regulation said in a statement.

The fine amounted to four percent on the company’s sales value in Chongqing in 2018, the regulator said.

Changan Ford Motor Co. is a 50:50 joint venture between the US automaker and Chinese state-owned Changan Automobile Group. It makes Ford passenger vehicles for the domestic market.

Global carmakers have experienced sliding sales in China, the world’s largest vehicle market, as the country veers toward an ultra-competitive electric future.

After years of strong growth, car sales declined last year for the first time since the 1990s, hit by a slowing economy, US trade tension, and a Chinese crackdown on shady credit practices crimping car-financing channels.

Sales dipped 2.8 percent in 2018 to 28.1 million units, according to that China Association of Automobile Manufacturers (CAAM), a pace that has accelerated in recent months.

Government subsidies and pollution concerns have also pushed Chinese consumers to drop gas-guzzling vehicles in favor of electric cars.

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Last Update: Wednesday, 5 June 2019 KSA 10:25 - GMT 07:25
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