Jaguar sues Jiangling over design

By Yu Xi Source:Global Times Published: 2016-6-5 22:08:01

Experts call for fair market, strict regulations in China

A Range Rover Evoque convertible sport utility vehicle on display at the Beijing International Automotive Exhibition on April 26 Photo: CFP

Jaguar Land Rover (JLR) is suing Chinese automaker Jiangling Motor Co for alleged design piracy, a signal to all domestic automakers that they need to respect intellectual property rights (IPR), experts told the Global Times on Sunday.

JLR, owned by India's Tata Motors, has claimed Jiangling's Landwind X7 sport utility vehicle (SUV) copied the design of the Range Rover Evoque, Reuters reported on Saturday, citing a person with direct knowledge of the matter.

"The local court in China is serving Jiang-ling with actions surrounding copyright and unfair competition," JLR confirmed with the Global Times on Sunday. The company declined to provide more details on these legal proceedings.

JLR's Evoque went on sale in March 2015. Jiangling's Landwind X7 SUV was officially launched in August 2015.

Jiangling could not be reached by the Global Times for comment as of press time on Sunday.

"Without detailed information, it's hard to judge whether Jiangling copied the design of the Evoque," Chang Yachun, a lawyer specializing in IPR issues at Beijing Kangda Law Firm, told the Global Times on Sunday. "JLR has to prove the design of the Evoque is unique if it wants to sue Jiangling for piracy."

It's unusual for international automakers to defend their IPR in the Chinese market, said Chang, noting that such cases require a complex investigation process.

Early in 2004, GM Daewoo Auto & Technology Co, owned by US auto giant General Motors (GM), filed a lawsuit against domestic automaker Chery Automobile Co for alleged piracy of a small car developed by GM Daewoo. GM and Chery ultimately reached an out-of-court settlement?in December 2005.

In the infancy of China's auto industry, some fledgling domestic vehicle producers faced claims of piracy from Japanese motor companies such as Honda. Although the Chinese industry has matured, the issue hasn't disappeared.

"JLR's case is a warning to domestic automakers to be aware of the importance of protecting IPR," said Chang.

If a vehicle producer indeed copied a competitor's design, it would have to stop manufacturing and selling the copied products, noted Chang.

Auto sales in China, the world's biggest auto market, climbed 6.3 percent year-on-year to 2.12 million units in April, data from the China Association of Automobile Manufacturers showed in May.

In such a booming market, "domestic automakers need to hire professional legal and design teams to avoid being charged with piracy," Qiao Shengpu, a partner and general manager of the auto department at Adfaith Management Consulting, told the Global Times on Sunday. "Also, domestic players need to keep an eye on the development of their international peers."

"Domestic automakers have to focus on innovation to enhance their competitiveness, particularly while they're facing fiercer competition from international automakers," said Qiao, noting that if JLR wins the case, it could encourage more companies to follow suit.

The State Council, China's cabinet, announced the "Made in China 2025" plan on May 19, 2015, aiming to boost Chinese manufacturing. It listed nine priorities including improving manufacturing innovation, according to a statement by the central government in May 2015.

"Chinese regulators need to create fair, transparent markets for all players," said Qiao, noting that tougher regulations are needed to protect IPR.

JLR's retail sales in April went up 11 percent year-on-year in China, 25 percent in the UK, 10 percent in Europe and 2 percent in North America, said the company.

JLR also announced its best April retail sales of 41,341 vehicles in 2016, up 11 percent year-on-year. It was the company's fourth consecutive record-breaking month, according to a statement in May.

Jiangling Motor sold 18,018 vehicles in May, down 9.9 percent year-on-year.

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