The Chinese market has proven to be a boon to German luxury automakers. However, the way that the companies have allegedly been controlling their supply of spare parts has begun to draw the ire of the nation's government. According to insiders speaking to Bloomberg, officials from the country's economic planning organization have opened a probe into Audi, BMW, Mercedes-Benz and some Japanese carmakers over claimed price inflation and limiting supply.

Specifically, the investigation centers around two aspects of how the companies do business, according to Bloomberg. Investigators want to know whether the original equipment component makers are able to sell spare parts only to automaker-authorized dealers or if they are also available to independent shops. There is also the issue of whether the price markup on replacement pieces is too high. The tight controls could be partially explained by China's reputation for producing counterfeit parts.

Evidently, the investigators haven't checked parts prices at car dealers elsewhere in the world. At least in the US, paying more at the dealer for factory components just goes along with owning a vehicle. If evidence of price fixing is found, the companies could face fines the equivalent of millions of dollars, according to Bloomberg.


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    • 1 Second Ago
  • 11 Comments
      b.rn
      • 4 Months Ago
      Spare parts in this country are absurdly overpriced too, especially from the German manufacturers.
        Mike
        • 4 Months Ago
        @b.rn
        As somebody who owns Toyota's and VW/Audi's, I can tell you right now that Toyota OE parts are way more expensive than VW/Audi OE. Especially after the Tsunami when plants in Japan closed down and lost inventory. I have 5 of the last OE FZJ80 large filters left in the USA, want one? :)
      Diz
      • 4 Months Ago
      This is nothing more than strong-arming by the Chi-Coms to get the spare parts business, much of which they supply with counterfeits and knock-offs, anyways.
        SloopJohnB
        • 4 Months Ago
        @Diz
        Knockoffs have their place in automobile-dom…in some cases they can be better than OEM, in most cases they're not. Anyway, they're a lot less expensive. Think of the US law that says a car manufacturer cannot void a warranty for use of non-OEM parts as reiterated by SEMA referencing a 2011 consumer alert by the FTC: In a Consumer Alert issued by the Federal Trade Commission (FTC), the agency confirmed that “The Magnuson-Moss Warranty Act makes it illegal for companies to void your warranty or deny coverage under the warranty simply because you used an aftermarket part.” The alert outlines key provisions in the law that provides protections to car owners. As defined by the FTC, an “aftermarket' part is a part made by a company other than the vehicle manufacturer or the original equipment manufacturer.” “The FTC’s reference to aftermarket parts is equally applicable to specialty parts,” said Russ Deane, SEMA’s General Counsel. “Under the Magnuson-Moss Warranty Act, the warranty cannot be conditioned to a specific brand of parts, services or vehicle modifications unless those parts or services are provided free of charge.” The alert notes that a consumer has the right to patronize independent retail stores and repair shops for parts and service without fear of voiding the new car warranty. The dealer/vehicle manufacturer has the right to deny a warranty repair but they must demonstrate that the aftermarket part caused the problem. The warranty remains in effect for all other covered parts.
      Charles
      • 4 Months Ago
      " The tight controls could be partially explained by China's reputation for producing counterfeit parts." Counterfeit parts? They have a reputation for making counterfeit cars.
      Chinh
      • 4 Months Ago
      Buy a Lexus. 100% of parts are Japanese, the whole car is made in japan.
      SloopJohnB
      • 4 Months Ago
      One other thing about Chinese-made components…I've sectioned/disassembled several Chinese-stamped OEM parts and their German or Czech or Croatia stamped parts and they appear to be functionally and appearance identical. However, I did not examine or determine any specification or metallurgical differences or material differences such as inferior aluminum or heat treating, or plastic or rubber, or inferior insulation on relay windings, or inferior/insufficient metal coatings on relay points, or counterfeit IC chips on electronic components. Chinese (and other foreign subs) as a general rule will skirt the manufacturer specification(s) without telling the manufacturer on the grounds that the substitution(s) are functionally equivalent to the OEM…and this may not be so in the long run in terms of durability, reliability, and maintainability. If that Chinese relay or evaporator or heat exchanger is incapable of being replaced without 10 hours of labor and the interior dashboard removal or disassembly, the customer is going to be REALLY unhappy that the Chinese or other non-OEM supplier cheated/counterfeited the component. This inevitably rebounds on the OEM manufacturers…Audi may be doing wonderfully in China and even assembling cars in China…but you have to wonder….if they're that good why aren't they being exported to the US with the Chinese manufacturing cost advantage? Could it be because they will neither meet US safety specifications nor US customer expectations of reliability, durability, and maintainability (even considering how low US expectations of same are)?
        Joerg
        • 1 Month Ago
        @SloopJohnB

        Due to not being able to export the auto's ( Audi's) to N.A. due to wage differences,\. If China exported their manuf. goods to N.A. they would kill Detroit.


      SloopJohnB
      • 4 Months Ago
      D'Oh!!! The same parts sold as OEM in the US are often "Made In China" and have Audi 4 circles on them…not counterfeit either. You see Made In China on many components of Audis sold in the US for example. The price differential is enormous, as a matter of fact. For at least one reason…parts are discounted to independent dealers in order for them to make a 30-50% profit on parts as well as labor. RICO, anyone? It's enough to make you buy a Tesla.
      Chinh
      • 4 Months Ago
      If DBenz has Chinese content, it will lose many customers, especially those uber rich who drive the S class.