EU Commission Imposing €2.9 Billion Record Fine to Trucks Cartel

The EU Commission on Tuesday hit five truck makers with its highest-ever cartel fine of € 2.9 billion for colluding to keep prices artificially high at the expense of consumers and on the implementation of emissions technologies.

"We have today put down a marker by imposing record fines for a serious infringement,” said EU competition Commissioner Margrethe Vestager, sending a "clear message” to everyone that is willing to abuse practices, such as the EU-based companies MAN, Volvo/Renault, Daimler, Iveco and DAF Trucks, by "colluding on the pricing and on passing on the costs for meeting environmental standards to customers.”

One of the companies, MAN, escaped the €1.2 billion fine, as being the company that turned in the cartel to the EU Commission, resulting in full immunity and an overall fine for the rest of the companies that is more than double the previous record of any EU operating cartel. Daimler was the company that received the biggest fine at €1.01 billion.

The highest cartel time until today was the €1.4 billion against a TV and computer monitor tubes cartel in 2012.

Vestager said that the above companies – together with SCANIA – were coordinating prices and new emission technology releases on the timing of introducing new emission technologies in 1997 and on passing on costs of those new technologies. This tactic became a regular over time, as the EU changed the environmental regulation over time.

In reality, the more stringent emissions standards have forced truck makers to invest in expensive technologies among which the exhaust treatment filters, while the companies pass that cost to the market following bad practices.

"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,” Vestager said.

Volvo, having absorbed Renault’s truck market, and is at the moment Sweden’s biggest company by revenue, received a €670.45 million fine and Iveco, which is part of Italian truck and tractor maker CNH Industrial, was fined €494.61 million. Finally, DAF Trucks, owned by Paccar, was fined € 752.68 million.

According to the EU Commission, the record fine is already cut by 10% as the four companies admitted the malpractices, resulting in this cut in penalties.

However, SCANIA was not part of the settle so the investigation is ongoing and yet no fine and no cuts have been applied. An EU official declined to disclose more information about SCANIA’s case, confirming that the talks between the two sides lasted for two months but stopped, without concluding.

https://www.neweurope.eu/article/eu-commission-imposing-e2-9-billion-record-fine-to-trucks-cartel/

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