China fines GM venture US$29m for monopolistic pricing
Shanghai authorities say joint venture set minimum prices on certain models
China will fine US carmaker General Motors’ joint venture 201 million yuan (HK$225 million, US$29 million) for monopolistic pricing, state television reported on Friday, ending speculation after an official warned of penalties against a US carmaker.
Shanghai’s pricing regulator said it would fine GM’s venture with China’s largest carmaker SAIC Motor Corporation for setting minimum prices on certain Cadillac, Chevy and Buick models, according to China Central Television.
“GM fully respects local laws and regulations wherever we operate,” the US carmaker said. “We will provide full support to our joint venture in China to ensure that all responsive and appropriate actions are taken with respect to this matter.”
SAIC did not immediately respond to a request for comment.
The fine follows comments by US president-elect Donald Trump questioning the one-China policy and his naming of Peter Navarro, a hardliner on trade with China, as a trade adviser, although there is no evidence that the penalty is a form of retaliation.
An official at the National Development Reform Commission on December 14 told state-owned China Daily the commission would fine a US carmaker for monopolistic behaviour, sending GM and Ford Motor shares skidding.
Industry sources have told Reuters the investigation was already underway before Trump’s recent comments, although it has raised fears that China could be seizing on the case to send a shot across the bow of the incoming US administration.
The penalty is the latest against carmakers after the commission began investigations in 2011, with Audi AG , Daimler AG’s Mercedes-Benz, Toyota Motor, and one of Nissan Motor’s joint ventures previously being targeted.
