Italian firm DR fined €6 million for misrepresenting Chinese cars

Italian car brands DR and Evo has been fined €6 million (£5.1m) for marketing Chinese cars as being made in Italy.

The European nation’s competitions and markets authority, the AGCM, said in a statement that the brands’ parent company, DR Automobiles, had wrongly marketed Italy as the origin of its cars.

The AGCM said the cars are actually produced in China and are only finished at DR’s Macchia d’Isernia plant, and customers had therefore been mislead.

It added that DR’s servicing arm had failed to guarantee an adequate supply of spare parts from at least 2022.

DR has been given 60 days to resolve the dispute.

Company founder Massimo Di Risio said: “We fully dispute the decision and are about to challenge it.” 

The antitrust probe was launched in October 2023. 

The news comes as part of a wider crackdown by the Italian government on foreign-made cars. Alfa Romeo renamed its newest model from Milano to Junior after business minister Adolfo Urso claimed the Polish-built crossover contravened a law stating geographical names could be used only on products made in Italy.

On the controversy, Alfa Romeo boss Jean-Philippe Imparato told Autocar: “When they told me it was forbidden by law – it’s not – I said: ‘Calm down: I’m not here to play politics; I’m just here to make an Alfa Romeo that’s sustainable for the future.’”

More recently, a shipment of Fiat Topolino electric quadricycles was seized at the port of Livorno for being emblazoned with the Italian flag despite being built in Morocco.

What is DR?

Little-known Italian firm DR looks set to rapidly become a major mainstream player in Europe, having outsold MG, Alfa Romeo, Mini, Cupra, Tesla and Volvo in its home market last year.

DR broke into Italy’s top 20 brands in 2023 when it sold 32,650 new cars for a market share of 2.1%, which represents year-on-year growth of 34%.

That followed a 2022 in which it grew by a remarkable 193%, emboldening it to expand abroad into Bulgaria, France and Spain.

DR was founded in 2006 with the objective of capitalising on the growing production of cheap cars in China.

It initially rebadged Chery cars for the local market and has since also formed relationships with JAC and BAIC. This growing spread of source material has enabled DR to launch three sibling brands over the past three years: Evo at the entry level, Sportequipe above DR itself and Ickx at the top.

At the lower end, the focus is on affordability – a quality of which Italian car buyers are famously fond. Across the four brands, there are now 17 models, from a small hatchback to crossovers and SUVs, an off-roader and a pick-up truck, variously offering petrol, LPG dual-fuel, plug-in hybrid and battery-electric powertrains.

DR also owns the rights to Osca, a sports car brand created by the Maserati brothers in 1947 for motorsport purposes, and is working on a relaunch programme.

The company last year expanded its production facilities to include four assembly lines for an annual capacity of more than 50,000 cars, added the capability to produce electric cars, upgraded its R&D and design centres and built a new spare parts warehouse.

Questions hang over exactly what work occurs at Macchia d’Isernia, however, following the conclusion of the AGCM’s probe.

Another complication could be Chery itself beginning sales of its cars in Europe under the Omoda and Jaecoo brands.