Competition Board fines auto firms for anti-competition
Apr 20, 2011 - 12:00 am GMT+3
by Apr 20, 2011 12:00 am
Turkey's competition board on Tuesday fined 15 carmakers and distributors a total of 277.4 million Turkish lira ($180.8 million) for breaching competition rules, slapping the steepest fine on Ford Otosan.
Shares in the joint venture between U.S. carmaker Fordand Turkey's Koc Holding turned negative on news of the 68.8 million lira penalty, the highest value fine, which amounts to 0.9 percent of annual revenue.
It also fined Tofas, a venture of Koc Holding and Fiat 47.8 million lira and Dogus Otomotiv 49.78 million lira.
Distributors for Mercedes Benz, Nissan, Peugeot, Toyota, Hyundai were also fined for sharing information on their vehicle stocks, sales targets and price strategies amidst huge demand for cars in fast-growing Turkey.
Karsan, Otokar, Mazda, General Motors Turkey and Honda Turkey did not receive fines.
"Although we did not see the details of the reasoning behind these penalty fees, they are higher than our expectations and clearly negative for short-term profitability," said Oyak Securities analyst Cemal Demirtas.
"However, considering the size of these companies, these penalty fees will have limited impact on auto companies' valuations but have a negative impact on 2011 earnings," he added.