The European Commission handed down fines totaling 2.93 billion euros (U.S. $3.32 billion) to five truck makers for colluding on prices and passing on costs associated with emissions compliance, the EU anti-trust watchdog said in a statement.
The European Commission (EC) Tuesday handed down record fines to five manufacturers of heavy-duty trucks for participating in a cartel, the European Union’s anti-trust watchdog said in a statement.
The commission penalized Volvo AB, Daimler AG, Paccar Inc.’s DAF and CNH Industrial NV’s Iveco a total of 2.93 billion euros (U.S. $3.32 billion) for colluding on prices and passing on costs associated with emissions compliance.
The EC said Volkswagen AG’s MAN SE was not fined despite its participation in the cartel because it came forward to reveal its existence to the commission. As part of the settlement agreement, all five companies acknowledged their involvement in the cartel, which colluded for 14 years – from 1997 to 2011 – on the factory prices of medium and heavy commercial trucks.
More specifically, the commission said its investigation, which began in 2011 following an immunity application submitted by MAN, 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, and are usually the basis for pricing in the trucks industry. The final price paid by buyers is then based on further adjustments, done at national and local level, to gross list prices;
• The timing of the introduction of emission technologies for medium and heavy trucks to comply with the increasingly strict European emissions standards (from Euro III through to the currently applicable Euro VI);
• And the passing on to customers of the costs for the emissions technologies required to comply with the abovementioned standards.
The heaviest fine went to Daimler at just over 1 billion euros, followed by DAF at 753 million euros, Volvo at around 670 million euros and Iveco at around 500 million euros. Had MAN been penalized, it would have been required to pay around 1.2 billion euros, the EC said.
In setting the level of fines, the commission took into account the companies’ sales of medium trucks and heavy trucks in the EEA, the high combined market share of the companies, the geographic scope and the duration of the cartel. The EC noted that fines for Volvo/Renault, Daimler and Iveco were also reduced based on their cooperation with the investigation under the 2006 Leniency Notice.
“Today’s decision underlines the importance of a functioning competitive market to foster the development and dissemination of cost-efficient low-emission technologies, which is one of the elements of the upcoming European Strategy for low-emission mobility,” the commission said.
Despite their admission of wrongdoing, the truck makers will still have the opportunity to appeal the decision in court, including the fine amounts.
“We have today put down a marker by imposing record fines for a serious infringement,” Commissioner for Competition Margrethe Vestager said of the decision. “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,” she added. “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.”
EC slaps truck manufacturers with record cartel fines
