* Apple, Volkswagen criticised by top TV show
* Chinese firms also targeted in the past
* Official TV expose can have big impact in China
By Adam Jourdan
SHANGHAI, March 15 Technology giant Apple Inc
and car maker Volkswagen AG were singled
out by state-run China Central Television (CCTV) in its annual
corporate malpractice expose.
On its "3.15" investigative special aired late on Friday,
CCTV said that Chinese customers were not given the same
post-sales service from Apple as it gave to users in other
The report also said that the direct shift gearbox (DSG)
transmission, a long-standing issue for Volkswagen, was causing
cars to speed up or slow down during driving.
Volkswagen, which plans to almost double production capacity
in China to 4 million cars in the next five years, promised
action in response to the "3:15" show, whose name refers to the
date of World Consumer Rights Day.
"We take this report very seriously and we will quickly make
contact with our consumers to resolve the issue," it said on its
official Chinese Weibo microblog.
In a statement Apple China said: "Our team is always
striving to exceed our customers' expectations, and we take any
customer concerns very seriously."
Apple looks to China not just as its main production base,
but also to re-energize slowing growth, the result of rising
smartphone penetration in mature markets. CEO Tim Cook sees the
world's No. 2 economy as virgin expansion territory, and Apple
singles out the region in every quarterly results report.
The television show has named and shamed a number of
prominent Western companies in the past, hitting the sales and
stocks of its targets in a retail market that is forecast to be
the world's largest in three years.
Last year "3:15", one of the most widely watched shows in
China, singled out fast-food giant McDonald's Corp and
French hypermarket chain Carrefour SA for food safety
The companies were forced to apologise and their shares
slumped as China's army of half a billion microbloggers
unleashed their anger online.
U.S. retailer Wal-Mart Stores Inc. and Korea's Kunho
Tire Co Inc also have been blasted by state TV on
Consumer Rights Day.
In December, a separate state television report triggered a
food safety scare at Yum Brands Inc. restaurants,
cutting its China same-restaurant sales by 20 percent in January
Chinese companies have not been spared from scrutiny.
Public concern about food safety, pollution and corporate
corruption has intensified over the last few years, after state
media exposed malpractice at local firms including web search
engine Baidu Inc and milk producer Inner Mongolia Yili
Industrial Group Co.
"These TV exposes create the impression that you can't trust
that brand," said Torsten Stocker, head of Greater China
consumer practice at Monitor Deloitte. "If there's some smoke
then maybe there's much bigger fire."
In a bid to preempt any negative publicity on Consumer
Rights Day, some companies launched customer-friendly promotions
ahead of the TV show. McDonald's will give out free breakfasts
on Monday and Wal-Mart launched an "adopt-a-tree" campaign.
But some Chinese consumers said that the revelations from
the "3.15" show would nonetheless have a significant impact on
their choice of products in the future.
"I think the exposure of these companies makes them hard to
believe again, at least I myself will boycott these companies,"
Sherry Chen, a clerk at DBS bank in Shanghai, told Reuters in
the city's affluent financial district ahead of Friday's show.
The show also stirred up vitriol online in China. Within an
hour of the broadcast, Apple had been mentioned 50,000 times on
popular web microblog Weibo, China's version of Twitter which
has more than half a billion users.
While many posts on Weibo were negative, the targeted
companies may take solace that some users were not entirely
convinced by the "3.15" show, which is a colourful mixture of
under-cover footage and pro-consumer song-and-dance routines.
"Tonight's 3.15 hit out against corruption. But the most
fraudulent thing at the end of the night was the show itself,"
posted Weibo user 'Soledad Horse'. "Oh CCTV, can't you try and
find some intelligence from now on?"