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EU fines truck producers EUR 2.93 billion for participating in a “cartel”

EU fines truck producers EUR 2.93 billion for participating in a “cartel”
Photo of Margrethe Vestager © European Union, 2016

The European Commission has imposed a record fine of EUR 2.93 billion (USD 3.23 billion) on Volvo/Renault, Daimler, Iveco and DAF for breaking EU anti-trust rules. The European Commission said that these truck makers colluded for 14 years on truck pricing and on passing on the costs of compliance with stricter emission rules.

MAN, which was part of the “cartel,” was not fined, as it revealed the existence of the cartel to the European Commission. All companies acknowledged their involvement and agreed to settle the case, the European Commission announced yesterday.

“We have today put down a marker by imposing record fines for a serious infringement. In all, there are over 30 million trucks on European roads, which account for around three-quarters of inland transport of goods in Europe and play a vital role for the European economy. It is not acceptable that MAN, Volvo/Renault, Daimler, Iveco and DAF, which together account for around 9 out of every 10 medium and heavy trucks produced in Europe, were part of a cartel instead of competing with each other. For 14 years they colluded on the pricing and on passing on the costs for meeting environmental standards to customers. This is also a clear message to companies that cartels are not accepted,” said Commissioner for Competition, Margrethe Vestager.

Road haulage is an essential part of the European transport sector and its competitiveness is contingent on the prices of the vehicles used by transporters. The decision relates specifically to the market for the manufacturing of medium (weighing between 6 to 16 tons) and heavy trucks (weighing more than 16 tons).

The European Commission’s investigation revealed that MAN, Volvo/Renault, Daimler, Iveco and DAF had engaged in a cartel relating to coordinating prices at “gross list” level for medium and heavy trucks in the European Economic Area (EEA). The “gross list” price level relates to the factory price of trucks, as set by each manufacturer. Generally, these gross list prices are the basis for pricing in the truck industry. The final price paid by buyers is then based on further adjustments, done at national and local level, to these gross list prices.

The infringement covered the entire EEA and lasted 14 years, from 1997 until 2011, when the European Commission carried out unannounced inspections of the firms. Between 1997 and 2004, meetings were held at senior manager level, sometimes at the margins of trade fairs or other events. This was complemented by phone conversations. From 2004 onwards, the cartel was organised via the truck producers’ German subsidiaries, with participants generally exchanging information electronically, the European Commission said.

 

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