After years of “car races” on the road to the arbitrary exploitation of the monopolistic windfalls of the chinese market, united states and european automobile manufacturers will have to press for “brakes”。
Yesterday morning, the secretary-general of the commission, lee park min, said at his press conference on the promotion of productive services that the investigations into audi and chrysler had shown that there was indeed a monopoly in the two companies and that they would be punished accordingly in the near future. At the same time, he stated that “ndc has recently completed an investigation into the monopolization of car parts in 12 japanese enterprises and will impose penalties in accordance with the law”
This is not the first time that a spare parts business has been receiving a “failure”. On 26 september last year, the united states department of justice informed that nine japanese companies, including the japanese automobile, the mitsubishi electric power plant and mitsubishi heavy labour, had admitted to manipulating the price of united states car spare parts and would pay more than $740 million in fines for that。
“no country will tolerate the monopolistic profits of foreign enterprises in its own country.” under-secretary-general choi dong-soo of the china car joint conference stated to the reporter。
As anti-monopoly investigations deepen, the cost of luxury cars, spare parts and maintenance can be expected to fall, and chinese consumers will have a better consumption environment. For the relevant car companies and dealers, shocks are inevitable and the overall pattern of the chinese automobile industry will change significantly。
Investigation started at the end of 2011
“the ndc survey of cars and accessories began at the end of 2011. On the basis of extensive consultations with the relevant enterprises, trade associations, experts and lawyers, we have investigated a number of car complexes, spare parts producers and dealers who have committed serious violations of the antimonopoly law.”
Li park min provided a detailed update on the progress of the investigation, and the shanghai csd investigation of chrysler and hubei provincial price offices is nearing completion. Is there a monopoly on mercedes and evidence is being investigated. On 4 august, the commission's price and antimonopoly departments conducted an investigation into the benz office in shanghai. Last week, the antimonopoly subdirectorate of the price authority of jiangsu province also conducted an antimonopoly investigation against mercedes dealers in five cities: suzhou, no sing and tanyang。
“there are now antimonopoly measures in many industries, including the automobile industry, in order to accommodate the demands of a comprehensive and deeper reform and to maximize the impact of the market.”。
The anti-monopoly survey of the automobile sector by the relevant state authorities focused on the “zero-sum ratio” of excessive spare parts prices. The so-called zero-sum ratio, which is the price of the spare parts quoted in shop 4s, as authorized by the manufacturer, divided by the price directed by the new car manufacturer, reflects whether the manufacturer has taken excessive profits through repairs and maintenance. The “zero-sum ratio” is usually considered reasonable within 300 per cent, and the domestic luxury car brand usually exceeds 400 per cent. In april this year, a zero-sum report issued by the china insurance industry association and the chinese automobile maintenance association placed beijing-class w204 at the top of the list, with 1273 per cent of all car parts。
Automobile manufacturers: lower prices or false snakes
In the face of anti-monopoly investigations, multinational motor companies have begun to announce lower spare parts prices in response, including chrysler, audi and mercedes。
Currently, china's luxury car market is dominated by foreign brands, particularly german brands, in which audi, bmw and mercedes mercedes share approximately 70 per cent。
The managing director of automotive foresight consulting, zhang zhang, has been engaged for many years in consultancy services in the automobile industry and has learned a lot about the high-profit space offered to high-end car manufacturers by the chinese market. In his view, the irregularity of the profits of many car manufacturers selling a car on the chinese market, which required 10 vehicles to be sold abroad, should be reversed. Zhang zhang was of the view that high-end car manufacturers, such as luxury cars, were undoubtedly the hardest hit by the wave of antimonopoly operations。
According to press reports, rmb 1. 89 million (us$305,000) was sold in the chinese market, while rmb 540,000 (us$ 87,000) was sold in the united states market。
“an antimonopoly investigation should not be a short-term act, but should establish long-term surveillance measures and mechanisms; otherwise, it may not be too low and the price will soon be restored.” choi dong-gi is concerned about the final outcome。
In fact, there are also a number of industry sources who remind that at the top of the tide, it is not excluded that automobile companies deal with the inspection of the relevant state departments through price discounts and snakes。
In the case of chrysler, the price of some products and spare parts has been revised downwards in recent days, with the average reduction in the price of spare parts reaching 20 per cent. Of these, the price of the flagship product jeep grand cherokee srt8 was reduced by rmb 65,000 and the price of the grand cherokee 5. 7l flagship stylish version by rmb 45,000。
In this analysis, market sales experts point out that these vehicles appear to have been subject to large price reductions, which appear to be very determined, but it is clear to all that they are very small in the chinese market each year, and that they, like jeep's grand cherokee srt-8, are less than 50 vehicles each, and that they appear to have been reduced in such a fashion。
Dealer: 4s sales model expected to break
Automobile dealers are expected to have a first chance of breathing freely after they have been soft and have voluntarily reduced prices。
Automobile industry sources have indicated to accredited journalists that the 4s store in the country currently operates under a brand mandate, single-branding and centralized management by the car general dealer. The current 4s shop model has evolved to its peak, and more policies will be needed in the future to untie and support the diversification of the car sales model. As monopolistic patterns are broken, the car market will be re-washed to change the current imbalance in resource allocation。
Some auto industry researchers believe that antimonopoly investigations will have a far-reaching impact on the whole industry, especially in the area of circulation, where the break-up of monopolistic patterns will help optimize the allocation of market resources. In the context of the recent initiative of the general directorate of commerce and industry to eliminate general distributors and authorize dealers to file, on the one hand, the promotion of diversified business models such as “car supermarkets” by large and powerful car dealers will lead to the future of 4s stores breaking down the current situation of single-brand car sales, with the prospect of operating models such as “car malls”, “car supermarkets”, including large groups, and cars such as the asha, and on the other hand, the promotion of import car markets, such as enterprises offering wholesale trade services such as national motor vehicles。
Spare parts dealers: or “first battle” to deepen reform
Automobile manufacturers ' monopolistic practices consist mainly of two aspects: first, fixing the price of the car as a whole, and secondly, limiting the price of spare parts and maintenance for 4s. Senior members of the automobile industry stated that some of the brands currently reduced the price of some of the models, but that the zero ratio for other models was still not low. The normal international zero-sum ratio is 2 to 1 or 3 to 1, and it is assumed that future reductions in transnational brands may be higher in spare parts rather than car prices。
Dr. Joe leung, managing director of the chinese society for automotive engineering, told the press that the prices of spare parts for many imported vehicles were currently high, owing to the manufacturers ' monopoly on the supply of spare parts, and that dealers had no right to speak at all. Some spare parts would have required us$ 50 per unit, but the manufacturer required consumers to change in groups at a price of up to us$ 500, a pattern that led to a monopoly on spare parts prices。
According to choi dong-soo, the underlying reasons for the monopoly of japanese spare parts manufacturers are their access to core technological advantages, high technical barriers and the difficulty of changing antimonopoly policies alone. He therefore suggested that, in addition to requiring them to reduce their prices, spare parts enterprises could also be required to engage in joint ventures with local chinese enterprises to upgrade our technological capabilities on the one hand and to change the monopoly pattern on the other。
Indeed, the issue of auto parts monopolies has attracted wide attention and attention, and once the monopoly of car manufacturers in this area is broken, the automobile parts industry is likely to be the first to introduce a more adequate market competition mechanism as the “first battleground” for deeper market reforms in the automobile industry。
Responsible editor: zhang dei
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