China fines General Motors $29 million for price-fixing

December 28, 2016

Here in America, the president-elect has spent plenty of time talking about his plans for de-regulation. Across the Pacific, however, there's no sign that China has any such intention of scaling back government oversight. In fact, Beijing regulators are now gearing up to fine General Motors 201 million yuan ($29 million) for price-fixing.

The news isn't entirely surprising. Hints of GM's problems with government first made headlines on December 14, via a report in China Daily newspaper. The cause of the government's anger? Pricing of vehicles that GM has developed in partnership with massive Chinese automaker, SAIC Motor Corporation.

On state television, government officials have now confirmed that that partnership will be fined for setting minimum prices on Buick, Cadillac, and Chevrolet models. Specifics of the fine haven't been formally revealed, and SAIC hasn't yet responded to the report. However, GM has said that it will work with Chinese officials to ensure that the partnership conforms to existing laws.

To be fair, GM isn't the only foreign automaker to draw Beijing's ire. Audi, Mercedes-Benz, and Toyota are among several companies that have been fined for monopolistic business policies over the past five years or so.

There's some speculation that China's dust-up with GM is retaliation for president-elect Trump's gaffe--calculated or not--involving a phone call with Taiwanese president Tsai Ing Wen. Shortly after reports of the call began making headlines, Trump began publicly calling into question the logic of America's "One China" policy. And that, in turn, has led some analysts to think that China's fining of GM is payback for that kind of talk.

However, others point out that the investigation of GM and SAIC began long before that phone call. And one observer in particular thinks that China's actions have little-to-nothing to do with Trump and everything to do with GM. (It's an interesting read, if you have time for it today.)

For more on this, check out our colleagues at Motor Authority.

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