GERMANY: Refrigeration compressor manufacturer Bitzer is to wage war against what it sees as a rising tide of product piracy.
While incidents of product counterfeiting have been plaguing air conditioning and refrigeration manufacturers for some years, many companies have been reluctant to talk about the problem in the past. Bitzer says it will be taking a more proactive approach to dealing with counterfeiters in the future
“For some time now, Bitzer has been observing an increase in product piracy among the company’s compressors, spare parts and pressure vessels,” the world’s largest independent compressor manufacturer said in a statement from its headquarters in Sindelfingen, Germany.
“This development now has a negative impact on the entire industry and refrigerant manufacturers. This is unacceptable because, unlike with counterfeit watches or handbags, technical applications can be very dangerous when pirated products of poor technical quality are used.”
Aside from safety, Bitzer complains that the performance is also unlikely to match an original product and the low-quality components significantly reduce both the service life and reliability during operation.
Product piracy has achieved highly sophisticated and professional results in the air conditioning and refrigeration industry. Most, if not all, the counterfeiting activity centres on China where unscrupulous product counterfeiters even go as far as copying catalogue data and packaging to mislead buyers.
“Experienced counterfeiters copy Bitzer compressors with a level of perfection that makes it nearly impossible to tell them apart from the original,” says Bitzer.
“While they may look the same, when it comes to quality, the poorly constructed components cannot withstand the high demands and will likely experience limited functioning after a short period of time or be completely defective and require repair.”
In addition to complete compressors, Bitzer also warns about copied spare parts and the well-publicised issue of fake refrigerants which led to injury and death in the container refrigeration industry in 2011.
The manufacturer also warns of the risk of motor damage, liquid slugging, heat damage and short circuits, which are often irreparable and can only be identified with in-depth analysis. It also warns that the use of counterfeit spare parts also voids the warranty for the entire product.
Bitzer strongly advises against accepting unusually cheap offers for compressors, spare parts or refrigerants.
“Counterfeits have become a mass phenomenon, and Bitzer is increasingly taking legal action,” says the company.
“Suppliers of such products are always thrown out of trade fairs and have to remove Bitzer logos immediately. That’s because we’re dealing with a network of counterfeiters and distributors who sell very authentic-looking copies all over the world. The criminals pretend to be Bitzer partners and thus harm both the company and the customers.”
Recognising that it’s difficult to differentiate between an original and a copy visually, Bitzer says it is now introducing a diverse range of measures to make it possible to clearly tell them apart. While Bitzer’s statement does not detail what these measures are, the Cooling Post believes that they include anti-counterfeit labels and the use of QR codes to check authenticity.
While the most high profile and well-publicised anti-counterfeit activity has been that taken by the refrigerant manufacturers DuPont and Honeywell, many of the big refrigeration and air conditioning component suppliers have also been affected. It has been a problem for 10 years or more and if Bitzer’s experience is to be believed, despite Chinese government attempts to stamp down on the illegal activity, the problem is getting worse.
Emerson, with both its Copeland compressors and Alco valves, is known to have been targeted by counterfeiters as has Danfoss but many manufacturers appear reluctant to talk about the problem, perhaps for fear of affecting sales of its legitimate products.
At the end of last year, Chinese authorities raided a wholesale market in Guangzhou and found two companies selling fake Bitzer compressors. There are also reports of seizures in Shanghai in 2008 of fake Emerson compressors, filter driers and expansion valves. The same year, in the Xicheng district of Beijing, authorities seized “several hundred thousand dollars” worth of counterfeit Danfoss and Emerson brand refrigeration parts from 13 companies.
In July 2012, police seized 40 fake Danfoss Maneurop compressors and a number of semi-finished products and finished parts from a remanufacturing workshop in Beijing. More fake Danfoss product was uncovered in May and June last year when Shanghai Customs seized 170,000 thermostats in two consecutive shipments bound for Iran.
There were incidents of product being confiscated, injunctions and stands being closed at major European exhibitions like Mostra Convegno and IKK throughout the 2000s. At the IKK show in 2006 both Honeywell and Emerson were granted injunctions against Chinese manufacturers. Danfoss was also affected. German Court bailiffs removed counterfeit R410A and promotional material from three Chinese stands and Emerson had to take similar action for infringement of copyright on one of its Alco valves.
The internet has been a prime area of activity for many counterfeiters, although these more overt operations make the counterfeiters easier to detect. In 2011, Danfoss won a trademark infringement lawsuit against an internet sales operation in Sichuan selling counterfeit Danfoss brand industrial products.
Counterfeits appear to have been a particular problem for Danfoss in Russia last year when a large number of counterfeit copies of its expansion valves, solenoid valves and coils, filters, dryers, sight glasses, ball check valves and pressure switches appeared on the market. One of the suppliers of the fake product turned out to be one of its own distributors.
In May 2010, police and government officials seized more than 10,000 fake Danfoss products in Dubai. The products were seized from 20 different Dubai companies which were trying to sell them at the same price as original Danfoss products. The seized products included 7,800 filter driers, 1,565 expansion valves, 1,575 orifices, 212 compressors, and 1,625 product labels.
Air conditioning manufacturers have also been affected. In 2005, Korean manufacturer LG was forced to introduce an anti-counterfeiting programme after fake LG air conditioners started appearing in the Middle East and Africa. Refrigeration tools manufacturers are also known to have been targeted.