Paccar Inc. will take a $600 million pretax charge — $446 million after taxes — against first-quarter earnings due to settlements related to a European price-fixing case in 2016.
The Bellevue, Washington-based truck manufacturer in 2016 set aside $945 million related to the European Commission’s investigation of major European commercial vehicle manufacturers. It eventually paid an $833 million fine. The commission found that truck makers colluded from 1997 to 2011 to raise prices amid changing emissions standards.
EC slammed truck makers in 2016
The EC told heavy-vehicle manufacturers in November 2014 that it was looking into potential price-fixing. That followed a probe started in January 2011. Volvo Group and Daimler Truck also set aside funds to cover a combined $3.2 billion fine.
Paccar is the parent of the DAF Trucks brand sold in Europe and other non-American markets. Its North American brands are Kenworth and Peterbilt. Neither is sold in Europe or involved in the case.
The new charge accounts for settlements arising out of the original case.
“Following the settlement, legal proceedings seeking damages were filed against all major European truck manufacturers,” Paccar said in an 8-K filing Tuesday with the Securities and Exchange Commission. “During the first quarter of 2023, the company settled with several claimants.”
UK tribunal rules against Paccar
In February, a United Kingdom appeal tribunal ruled against Paccar and subsidiaries including DAF Trucks for overcharge claims, according to Transport Dive.
The tribunal found Paccar owed at least $37 million to Royal Mail Group and approximately $3.6 million to BT Group and related British Telecommunications businesses.
Paccar said it thinks it has “meritorious defenses to the legal claims.” But it said final amounts it might have to pay are beyond its ability to estimate and could have a material impact on the company’s financial results.”
Paccar reports Q1 earnings before markets open on Tuesday.
Daimler Truck said in its 2022 annual report that claims are pending across approximately 20 European countries. That comes after its former parent company, Daimler, paid a fine of more than $1.2 billion in 2016.
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