ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Trade war

China fines Ford $24m in 'chilling' move amid trade war

Antitrust case against US automaker comes on heels of FedEx probe

Changan Ford Automobile operates this plant in southwestern Chongqing.   © Xinhua

BEIJING -- Chinese authorities levied a 162.8 million yuan ($23.6 million) fine against Ford Motor's local joint venture on Wednesday for violating antitrust laws, just days after reports that regulators had begun an investigation into FedEx.

Changan Ford Automobile, which the U.S. carmaker operates jointly with state-owned Chongqing Changan Automobile, had ordered dealerships in the Chongqing metropolitan area to set minimum resale prices on vehicles since 2013, according to the State Administration for Market Regulation.

The company's actions "deprived downstream dealers of pricing autonomy, excluded and restricted competition within the brand, as well as damaged fair competition in the relevant market and consumers' legitimate interests," the regulator said in a statement. The fine is equivalent to 4% of the venture's annual sales in Chongqing.

The enforcement action comes amid trade frictions between Washington and Beijing.

"We're left with no choice but to view this through the lens of the trade dispute," said Wendy Cutler, vice president at the Asia Society Policy Institute and a former U.S. trade negotiator.

"China has basically run out of products to put tariffs on, so we may be seeing more and more of actions in the non-tariff world, which in many respects, could be even more onerous and more chilling" for U.S. companies, Cutler added.

The move followed a report Saturday that regulators launched a probe against U.S. company FedEx for rerouting packages belonging to Huawei Technologies without first notifying the Chinese telecom manufacturer. CCTV, the state broadcaster, called the probe a "warning" to foreign operators that violate national rules and regulations.

The U.S.-China trade war has ensnared businesses in a battle over technological supremacy. Washington recently placed Huawei on a blacklist that essentially bans exports of American-made components to the company.

The penalty against Ford echoes the 2016 antitrust case launched by Shanghai municipal officials against General Motors' joint venture. That unit incurred a 200 million yuan fine for selling vehicles with minimum price points. Last year, U.S. chipmaker Qualcomm withdrew its proposed $44 billion buyout of Dutch peer NXP Semiconductors after failing to receive approval from the state regulator.

Nikkei staff writer Alex Fang in New York contributed to the article.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends June 30th

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media