China's state-run television reported that Jaguar Land Rover hasn't properly handled an alleged flaw on an SUV model, and that car dealerships for several big brands inflate repair costs.
Jaguar Land Rover's Range Rover Evoque SUVs have gearbox problems that the company has failed to fully address, according to the annual consumer rights program shown Sunday on China Central Television, citing customer complaints. This year's program also contained allegations that dealers for brands including Nissan, Volkswagen and Mercedes overstated problems with vehicles and then overcharged for simple fixes.
The program, broadcast each year to mark World Consumer Rights Day, typically has reporters with hidden cameras posing as customers to expose flaws at companies. The show also reported on allegations that local giant China Mobile Ltd. enabled fraudsters trying to swindle money from customers. Companies singled out in past years include McDonald's Corp., Volkswagen AG, and Apple Inc., whose Chief Executive Officer Tim Cook apologized to Chinese consumers after 2013's program.
"In addition to possible fines, there is the loss of reputation as the show receives wide media coverage and threads through social media," said Jim Feldkamp, founder of Chinese website Mingjian.com, which reviews consumer products.
Tata Motors Ltd.'s Jaguar Land Rover apologized to consumers for "the inconvenience and trouble caused" in a posting on its official microblog. The company said it is working to resolve the problem as quickly as possible.
On the car dealerships, Volkswagen said in an e-mail that it provides tools and training to its dealers, and regularly monitors their performance via means including audits. Customers are welcome to contact the company directly if they have problems with dealer service, the company said.
Dongfeng Nissan Passenger Vehicle Co., a joint venture between Japan's Nissan Motor Co. and Wuhan, China-based Dongfeng Motor Corp., takes "very seriously" CCTV's allegations that its dealers inflate simple repairs, and has already formed working groups to to investigate the problem, according to an e-mailed statement.
Senol Bayrak, a spokesman for Daimler AG, said he couldn't immediately comment on the report.
China Central Television, often referred to as CCTV, also reported that China Mobile and China Tietong Telecommunications Corp. allowed fraudsters to gain access to numbers used for official phone-company operations and failed to prevent the use of fake caller ID numbers. Fraudsters impersonated banks and the police to obtain money, the broadcaster said.
China Mobile posted a statement on its microblog account: "The problem of false calling reported by CCTV on its March 15 program is a serious violation of the legitimate rights and interests of consumers," it said. "China Mobile has instructed China Tietong Telecommunications Corp. Ltd, Guangdong Mobile and Shanghai Mobile to check this out carefully, and handle the matter seriously."
The official broadcaster also said that international clothing brands sometimes fail Chinese government quality inspections, with 23,818 batches blocked in random inspections last year. It identified H&M, Gap, Zara, Mango, American Apparel, Old Navy, Forever 21, Armani as among the brands affected, citing inspection-quarantine officials.
Some shipments from the brands failed standards for reasons including color durability, PH levels and formaldehyde content, CCTV said. Jennifer Gee, a spokeswoman for Gap Inc., said in an e-mail response that she is looking into the report and couldn't immediately comment.
China has made efforts to protect its consumers better as the rising middle-class becomes more vocal on grouses from food and product safety lapses to air pollution. A new consumer protection law introduced last year imposed greater penalties for fraud and false advertising, and added return policies for online purchases.
Apple's Mr. Cook apologized in 2013 after two weeks of being lambasted by state-run media for arrogance and poor customer service mainly for the offense of failing to replace the back covers of iPhones after repairs.
Chinese authorities often have reacted very quickly to the program with injunctions on accused companies. Last year, the Shanghai Administration for Industry and Commerce ordered Nikon Corp. to stop selling its D600 digital cameras and offer free repairs, after the program claimed defects caused "black spots" on photographs.
--Bloomberg News, with Ad Age staff--