For Foreign Brands in China, Another Worry: Their Price Tags


For over a year, the powers that be in China have been watching the prices charged by foreign high-end auto brands here. First, the country’s state news service Xinhua asked why cars sold in China can cost two to three times what they go for overseas.

Then came a wave of probes into the prices of vehicles, spare parts and services, and last week, fines totaling nearly $46 million were announced for Audi and Chrysler amid accusations of pricing violations.

With the business climate shifting, Chrysler cut prices weeks ago on two Jeep Grand Cherokee models while Jaguar Land Rover also slashed prices on three models by a whopping $32,000 on average. Many foreign brands, including Mercedes, BMW and Lexus, have lowered prices for spare parts. (The major share of the China markup on foreign luxury cars and other prestige goods is from taxes and duties imposed by China, though observers say some brands have also shifted prices upward here to position themselves as even more upscale.)

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