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India slaps $420m in antitrust fines on 14 carmakers


The automakers fined included the local unit of Honda, Toyota, Volkswagen and its unit Skoda, BMW, Daimler's Mercedes-Benz, Fiat, Ford, General Motors and Nissan. Local carmaker Tata Motors was handed the highest penalty of Rs13.46 billion. Other Indian carmakers fined were Maruti Suzuki, Hindustan Motors and Mahindra & Mahindra. Photo: Bloomberg file

New Delhi: India's pricing regulator has fined more than a dozen global and local carmakers a total of Rs25.5 billion ($420 million) after a probe found they had engaged in anti-competitive practices in the world's sixth largest auto market.

The Indian penalty follows heightened regulatory scrutiny of the auto industry in China, the world's largest auto market. Several global car and spare parts makers have been fined, or are being investigated, by China's anti-monopoly regulator, the National Development and Reform Commission.

The Competition Commission of India (CCI) said in a statement it had fined the 14 automakers after its investigation showed they were restricting access to spare parts, which in turn made them more expensive for consumers.

It listed the automakers fined as the local unit of Honda, Toyota, Volkswagen and its unit Skoda, BMW, Daimler's Mercedes-Benz, Fiat, Ford, General Motors and Nissan.

Local carmaker Tata Motors was handed the highest penalty of Rs13.46 billion. The other Indian
carmakers fined were Maruti Suzuki, Hindustan Motors and Mahindra & Mahindra.  The fine, equivalent to two per cent of the carmakers' three-year average India revenue, is payable within 60 days, the regulator said.

"The anti-competitive conduct... has restricted the expansion of spare parts and independent repairers
segment of the economy to its full potential, at the cost of the consumers, service providers and dealers," it said in the statement.

In a statement, Ford's India unit said it was reviewing the order and its implications, adding that the company had been working to enhance the availability of parts. A Tata Motors spokeswoman also said the company would study the CCI order before making any comment.

Mahindra & Mahindra said it planned to appeal the watchdog's order.  A Honda executive in India was not available for a comment, while a Maruti spokesman declined to comment. The India representatives of the other carmakers did not immediately respond to request for comment.

The CCI said it had launched its investigation in 2011 after receiving information that spare parts made by some companies in India were not freely available in the market, resulting in higher prices for the parts and repair and maintenance services.

It said it had asked the carmakers to rectify their anti-competitive behaviour, which it said impacted 20 million customers.

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