SHANGHAI, Aug 3 (Reuters) - China's regulatory agency is launching an investigation into chip distributors in the auto industry, citing suspicions of price gouging, it said on Tuesday.
The action by the State Administration For Market Regulation (SAMR) is the latest in a regulatory crackdown following a range of companies and industries targeted over the past year as the Chinese government clamps down on industry.
"In response to prominent problems such as speculation and high prices in the automotive chip market, the State Administration of Market Supervision has recently filed an investigation on car chip distributors," the agency said.
The firms were suspected of driving up prices, based on price monitoring and reporting clues, it added in its statement, and vowed to investigate and punish illegal acts such as hoarding, price-gouging and collusion.
A global shortage of chips that began last December has disrupted supply chains and the hardware sector worldwide. Though initially concentrated in the automotive sector, it has since spread to affect a wide range of gadgets.
Panic about supply uncertainty has occasionally led chip buyers and distributors to purchase more chips than they need, creating a vicious cycle that further drives up prices.
In June, the chief executive of chipmaker Intel said he expected the shortage to hit bottom by year-end, with the market retuning to normalcy only by 2023.
In April China's regulator imposed a record fine of $2.75 billion on e-commerce giant Alibaba for engaging in anti-competitive practices.
Ok, this is getting a bit out of hand. A constant barrage of bearish news coming out of China after some stabilizing that happened at the end of last week. Not sure what the endgame here is for China or the CCP. On one hand, it makes no sense for them to lose the confidence of foreign investors with moves like this. Are they pushing the boundaries of patience of investors? Or is this a deliberate attempt to crackdown on each sector one by one?
Stocks likely to be affected by this: AMD, INTC, QCOM, NVDA and consequently TSLA, NIO, LI, XPEV, BYD. If you know some others that are a part of the cars in China, please post them in the comments
Submitted August 03, 2021 at 02:20AM by GadnukBreakerOfWrlds https://ift.tt/3rNSsTD
