▲ A Mercedes-Benz dealership in Seoul (Yonhap)

(LEAD) FTC-Mercedes-Benz

(LEAD) Antitrust watchdog fines Mercedes-Benz 11.2 bln won over misleading EV battery info

(ATTN: ADDS response from Mercedes-Benz in last 2 paras)

By Kim Han-joo

SEOUL, March 10 (Yonhap) -- South Korea's antitrust regulator on Tuesday imposed a fine of 11.2 billion won (US$7.58 million) on Mercedes-Benz for misleading consumers about battery suppliers used in some of its electric vehicle (EV) models.

The decision by the Korea Fair Trade Commission (FTC), which targets Mercedes-Benz Group AG and its South Korean unit, Mercedes-Benz Korea Ltd., comes nearly two years after public concerns over EV safety intensified after a major fire incident involving the company's EV model.

According to the FTC, Mercedes-Benz distributed sales guidelines to dealers suggesting that EQE and EQS EV models were equipped with battery cells from China's Contemporary Amperex Technology Co. Ltd. (CATL), the world's largest battery manufacturer.

However, some vehicles were actually fitted with cells from China's smaller supplier, Farasis Energy Inc., whose batteries had been recalled in 2021 in China before the launch of the EQE model.

The FTC concluded that the discrepancy was omitted from the internal sales guide and concealed from both dealers and consumers, the FTC said.

Concerns over EV battery suppliers have drawn heightened attention since a Mercedes-Benz EQE caught fire in August 2024, damaging more than 100 vehicles and destroying an underground apartment parking garage in Incheon, west of Seoul.

About 3,000 vehicles containing Farasis battery cells were sold between June 2023 and August 2024, generating roughly 281 billion won in sales, the FTC said.

The 11.2 billion-won fine, equivalent to about 4 percent of the related sales, is the maximum penalty allowed under South Korean law for such unfair practices, according to the regulator.

The FTC also said it has referred both Mercedes-Benz's headquarters in Germany and its local unit to prosecutors.

Following the decision, Mercedes-Benz Korea said it respects the FTC's announcement but disagrees with the ruling.

"Mercedes-Benz Korea has provided accurate and appropriate information to the media and customers," the company said in a statement, adding that it plans to seek legal procedures, including an administrative lawsuit.

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