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Mercedes-Benz to cut prices of auto spare parts in China

2014-08-04 09:47 Global Times Web Editor: Qin Dexing

Beijing Mercedes-Benz Sales Service Co, the German premium carmaker's sales, marketing and after-sales unit in China, announced on Sunday that it would lower the prices of some of its spare parts in the country in response to Chinese authorities' ongoing antitrust investigation of the auto sector.

The price cut, which will take effect on September 1, covers over 10,000 spare parts of all Mercedes-Benz models, and will be as much as 15 percent for some parts after the adjustment, the company said in a statement e-mailed to the Global Times.

"The adjustment…would lower costs for users and further enhance Mercedes-Benz's competitiveness in the after-sales market," the statement said.

In July, the company already lowered its maintenance prices by around 20 percent.

The price adjustment comes at a time when the auto sector is undergoing an antitrust investigation launched by China's top economic planner, the National Development and Reform Commission (NDRC), and the Ministry of Commerce.

Several premium auto brands have decided to lower their prices recently.

The China unit of UK high-end auto brand Jaguar Land Rover, for example, said on July 25 that it would cut the prices of three models in China by some 200,000 yuan ($32,366.13) each on average.

FAW-Volkswagen Automotive Co, which produces Mercedes-Benz' rival brand Audi in China, announced on July 26 that it would lower the prices for spare parts.

In a statement e-mailed to the Global Times in late July, the company said that its Audi unit has been "actively" cooperating with the investigation launched by the Chinese authorities.

As Mercedes-Benz follows suit, BMW, another premium auto brand in the Chinese market, is also very likely to make similar decisions, Wu Shuocheng, editor-in-chief at industry portal auto.gasgoo.com, told the Global Times on Sunday.

Wu noted that the price cut could bring benefits to both consumers and the overall after-sales market.

It is a foreseeable trend for high-end carmakers to lower their prices in China because of increasing competition, said independent analyst Zhang Zhiyong.

"But the authorities' antitrust investigation will increase their price cuts," Zhang said.

"As a result, the price difference between premium cars sold in China and abroad will be narrowed," he added.

Chinese authorities have stepped up efforts to fight monopolistic behavior. In the latest case, the State Administration for Industry and Commerce confirmed last week that it had launched an antitrust investigation into Microsoft Corp.

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