Two home appliance retailing giants in China saw their stock prices tumble on Wednesday morning as they scrambled to fight a price war provoked by a major online retailer.
Shares of the Hong Hong-listed GOME Electrical Appliances Holding Ltd. plummeted more than 8 percent to 0.66 HK dollar (8.5 U.S. cents) as of 11:30 a.m., while the Shenzhen-listed Suning Appliance Co., Ltd. dipped over 3 percent to 5.68 yuan (89.4 U.S. cents) during the morning trading session.
Liu Qiangdong, chairman of 360buy Jingdong Mall, China's second largest B2C online retailer in sales, announced Tuesday his company will sell all major electrical home appliances at cheaper prices than those of GOME and Suning starting from Wednesday morning.
Suning and Gome responded on the same day with promises to outrival 360buy in price discounts.
360buy is not listed in China's stock market yet.
Suning ranked China's top retailer in sales in 2011, followed by GOME, according to the China General Chamber of Commerce.
Suning.com, Suning's online shopping site, took up 3.7 percent of China's B2C market in the first half of the year, while 360buy had the second largest market share of 20.5 percent, after 47.6 percent taken by Tmall.com, owned by the Chinese Internet giant Alibaba Group, according to the China e-Business Research Center.
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