Investigators are currently expanding the scope of an automotive component price fixing probe. Officials in Australia, the U.S., Europe and Japan are collaborating to discern the breadth of the issue. So far, 20 automotive suppliers have been identified as being part of the investigation, though it's thought that authorities are looking into a significantly larger number of companies. In fact, a government official has already declared this investigation the largest such probe in U.S. history. Those that have been identified so far are publicly traded and must disclose such investigation to their shareholders by law. Private companies have no such obligation. According to Crain's Detroit Business, the companies in question supplied parts to both automakers and the aftermarket.

So far, only one company has been convicted of price fixing in the investigation. Furukawa Electric Company of Japan has been handed a fine of $200 million and three U.S.-based executives are headed toward incarceration. Sentencing has yet to occur for those workers.

The report says the scandal spreads across automotive systems, and subpoenas have been handed down for raids against at least 19 suppliers over six supply sectors. Even so, those subpoenas may be aimed at securing evidence against a company's competitor, not the manufacturer itself.


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  • 15 Comments
      Gorgenapper
      • 3 Years Ago
      Good. Now if only they can do the same for the bandits known as Rogers, Bell and Telus here in Canada. I have never seen such blatant price fixing when the iPhone became available for the latter two.
      Lamborrari
      • 3 Years Ago
      No wonder most OEM auto parts are so incredibly expensive. I always thought it was because of liability (risk of recalls or class-action lawsuits if parts go bad), but price fixing is a much simpler explanation. An auto part is often something you need if you want to drive to work or the store. They rip consumers off simply because they can --because there's a definite *need* for their product-- which sounds like a lot of other industries (healthcare, pharmaceuticals, higher-education, energy). I won't declare this investigation a success until I see auto parts get *significantly* cheaper.
        leunamme
        • 3 Years Ago
        @Lamborrari
        See, healthcare and pharmaceuticals, just like everything else is cheap as hell. It costs cents on the dollar... What you are paying for is for the billions spent on research and developing the structure, the professionals, the formulas...that's why that stuff is so expensive... For someone who is 22 to spend 10+ years studying 12hrs+ a day to become a doctor at age 32 is a terrible life decision. At age 32, they are at least $240,000 in debt and have yet to earn a salary above minimum wage. The only reason they're alive is because of student loans. Then, they have to work to pay off the debt, get married, etc...at age 32. Then you hear people who started working right out of college say that doctors earn too much. A 22 year old entering medicine makes absolutely 0 financial sense when any Joe Schmoe out of high school can enter the auto industry and make $60k every year. At age 32, the doctor is at -$240,000 while the autoworker is at +$600.000. Also, realize that those that enter medical school have to graduate at the top of their classes both in high school and in college. It takes a lot of hard work and dedication to get there. When the end product a person receives seems so simple, like a doctor's visit, you seem to lose perspective on the development costs it took to make that product possible. Granted, this has nothing to do with OEM...I just don't like the examples you use...
      Hazdaz
      • 3 Years Ago
      Why am I not that shocked. There's something very, very wrong when the individual parts to build a car cost many times what those parts cost when you buy them together.... namely in the form of a new car. I can't wait till more info on this situation comes out.
        SloopJohnB
        • 3 Years Ago
        @Hazdaz
        Well, not so. It does cost a lot to set up and maintain a supply pipeline for many parts, not just the parts that are known consumables. Collision repairs are one example...electronics that are constantly changing even within model years (make, model, year, and vin please to get some parts!) and then the OEMs are stuck with them. In this case it looks like the suppliers have gotten together to fix prices in response to the constant gouging pressure from OEMs to lower parts/assemblies prices.
      Polly Prissy Pants
      • 3 Years Ago
      If there's one thing a modern corporation hates, it's open markets and competition for their products.
        Dave R
        • 3 Years Ago
        @Polly Prissy Pants
        What funny is that these same corporations are the same ones that say "open/free markets, more competition, less regulation" to the public, but what they really do with less regulation is abuse market positions to screw the consumer. But hey - less regulation and free markets sounds good so it convinces Joe the Plumber to vote against his best interests. And then people wonder why the middle class is shrinking while the rich get richer while blaming the people trying to enforce and write legislation to protect the them... Quite ingenious...
      cashsixeight
      • 3 Years Ago
      Can someone explain this in english? I don't understand what this means... car parts cost money. The end?
      SimonSez
      • 3 Years Ago
      How about everyone quits pointing fingers at government officials, lawyers, unions, actors, etc and let's just say this: the human overall is a dishonest being that will generally do something to further their own livelihood at someone else' expense. If you think about it, unless you live out in the sticks on your own land and don't rely on anyone else to survive, someone somewhere is worse off because of your existence.
      harlanx6
      • 3 Years Ago
      These laws are on the books, and as we well know, seldom enforced. Selective enforcement of the law is an abomination. If it's a bad law, repeal it! If it isn't, officials have to be held responsible for it's enforcement. Immigration law comes to mind as well.
        SloopJohnB
        • 3 Years Ago
        @harlanx6
        Selective enforcement is the American way...and is that way in many countries. De minimis non curat lex. If EVERY law were enforced, the courts would be hopelessly clogged.
      Bryant Keith
      • 3 Years Ago
      This could really effective used car values...
      SloopJohnB
      • 3 Years Ago
      Gee, ya think? Parts cost have more than doubled in the last three years....between questionable warranty repairs (dealers repairing race-blown Porsche engines? WTF,O?) jacking up costs for everyone, why does this surprise anyone?
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