Schaeffler fined €370.5M for bearing cartel participation
Continental AG majority shareholder Schaeffler AG is one of five companies that have been handed substantial fines for operating a cartel in the automotive bearing market. The European Commission fined the companies a total of more than €953 million, with the largest single fine given to Schaeffler. The German manufacturer must pay €370.5 million, almost 40 per cent of the total penalty.
According to the European Commission, Schaeffler and five other companies – Japanese firms JTKET, NSK, NFC and NTN, and Sweden’s SKF colluded to secretly coordinate their pricing strategy, beginning in April 2004 and continuing for more than seven years, until July 2011. This collusion covered the entire European Economic Area (EEA). Japan’s JTEKT was not fined as its received immunity for revealing the existence of the cartel to the Commission. NSK, NFC, SKF and Schaeffler received reductions in their fines in acknowledgement of their cooperation in the investigation. The fines were then further reduced by ten per cent as all companies agreed to settle the case with the Commission.
“Today’s decision is a further milestone in the Commission’s ongoing effort to bust cartels in the markets for car parts, after the sanctions we imposed on producers of electric wires and of foam used in car seats,” stated the European Commission’s vice-president in charge of competition policy, Joaquín Almunia. “It is incredible to see that one more car component was cartelised. I hope the fines imposed will deter companies from engaging in such illegal behaviour and help restore competition in this industry. If left unchallenged, cartels for car parts might impair the competitiveness of the automotive sector and artificially raise the price paid by European consumers who buy cars.”
The fines were set on the basis of the Commission’s 2006 Guidelines on fines, and in setting their level the Commission took into account the companies’ sales of the products concerned, the serious nature of the infringement, its geographic scope and its duration.
In December 2013, Schaeffler stated it was fully cooperating with authorities regarding the investigation and that it anticipated it would receive a fine. “Based on Schaeffler’s best estimates the company has decided to take a provision of around €380 million in the fourth quarter of 2013,” the company wrote in a press release on 20 December. Schaeffler has yet to release a comment on the fine announced today.