Burger King, GM venture criticised on China consumer rights show


By Sophie Yu and Brenda Goh

BEIJING/SHANGHAI, July 16 (Reuters) - U.S. fast food chain Burger King and a car manufactured by a General Motors (GM) joint venture were picked out for criticism on Thursday by China's state television station in its high-profile annual show on consumer rights.

Since it was first aired by state-owned China Central Television (CCTV) in 1991, the television programme has become an event watched in fear by international and local brands alike, due to the potential impact on sales and public relations of appearing on its list of shame.

The programme has in previous years criticised foreign businesses such as Apple AAPL.O and Starbucks SBUX.O, resulting in prompt apologies from the companies.

Burger King and GM were the only foreign firms to feature on this year's show, which mainly focused on Chinese companies. The criticisms come at a time of heightened tension between the United States and China over trade, technology and other issues.

Burger King, owned by Restaurant Brands International (RBI) QSR.TO but whose Chinese outlets are mainly managed by Tab Food Investments (TFI), was criticised for allegedly selling products that failed to meet its own standards.

The programme cited a Burger King outlet in Nanchang, southeast China, where it alleged employees only put two pieces of cheese on the burger when there should be three.

Burger King China said on its official Weibo account that the outlet was managed by a sub-franchisee, and apologised for management mistakes given the practices were a departure from its "consumer is king" motto.

"As soon as we saw the report, we immediately set up a task force to conduct the investigation," it said, adding the franchisee ran six outlets which had now been shut down.

The show also interviewed buyers of the Baojun 560 sport-utility vehicle made by General Motors' GM.N Guangxi-based joint venture with SAIC Motor 600104.SS and a local partner. The customers complained of gearbox problems.

The venture recalled 12,485 Baojun 560 in 2016 to fix gearbox issues.

In a statement, the venture apologised for the inconvenience to consumers and said it was investigating. "We will be responsible for the issue at all costs," it said.

The show, usually aired on March 15 to coincide with world consumer rights day, was delayed this year by the COVID-19 pandemic.

It also discussed shoddily built new flats, online education services and said Qutoutiao QTT.O, an app that delivers customised feeds of articles and short videos to users based on algorithms, carried misleading advertisements with dubious health claims or which led to gambling websites when clicked through.

The New York-listed company saw its shares tumble in pre-trading after it was mentioned in an opening segment - even before the programme detailed its criticisms. They were down 11% after the two-hour show ended.

In a statement on its Weibo account, Qutoutiao said it realised there were many issues with its advertising ecosystem and that it would carry out an investigation.

"We are very grateful for the oversight and criticism provided by CCTV and the media," it said.

(Reporting by Sophie Yu and Brenda Goh; Additional Reporting by Yilei Sun in Beijing; Editing by Mark Potter)

((Sophie.Yu@thomsonreuters.com; 861056692136;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.