The ongoing investigation by the Department of Justice into price fixing in the automotive industry has nabbed one more company breaking the law. Japanese parts giant NGK Spark Plug Company agreed to plead guilty to a felony count of pricing fixing and bid rigging in the in the US District Court in Detroit. Its punishment is a $52.1 million criminal fine and to continue to cooperate with the DOJ's sleuthing into the problem.

According to the DOJ, NGK conspired to fix prices on spark plugs, standard oxygen sensors, and air fuel ratio sensors on vehicles from major automakers in the US, including the former DaimlerChrysler, Honda and Toyota, in a scheme that ran from at least January 2000 to July 2011. The charge claimed that the company and its co-conspirators held meetings where they agreed on bids and price quotes that were submitted to the automakers.

With the latest plea, the DOJ has caught 28 companies and 26 executives for price-fixing and bid rigging in the auto parts industry, and they have collected $2.4 billion in criminal fines. In 2013, the feds brought nine Japanese suppliers down at once, to collect $740 million. Scroll down to read the DOJ's complete announcement of the case.
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NGK Spark Plug Co. Ltd. Agrees to Plead Guilty to Price Fixing and Bid Rigging on Automobile Parts Installed in U.S. Cars

Company Agrees to Pay $52.1 Million Criminal Fine

NGK Spark Plug Co. Ltd., an automotive parts manufacturer based in Nagoya, Japan, has agreed to plead guilty and to pay a $52.1 million criminal fine for its role in a conspiracy to fix prices and rig bids for spark plugs, standard oxygen sensors, and air fuel ratio sensors installed in cars sold to automobile manufacturers in the United States and elsewhere, the Department of Justice announced today.

According to the one-count felony charge filed today in the U.S. District Court for the Eastern District of Michigan in Detroit, NGK Spark Plug engaged in a conspiracy to rig bids for, and to fix, stabilize and maintain the prices of, spark plugs, standard oxygen sensors and air fuel ratio sensors installed in cars sold to automobile manufacturers such as DaimlerChrysler AG, Honda Motor Co. Ltd. and Toyota Motor Corp., among others, in the United States and elsewhere. In addition to the criminal fine, NGK Spark Plug has agreed to cooperate in the department's ongoing investigation. The plea agreement will be subject to court approval.

"Today's guilty plea is just another example of the commitment of the Antitrust Division to preserving fair and legal competitive practices," said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division's criminal enforcement program. "We will continue to do whatever it takes to protect U.S. consumers and businesses."

According to the charge, NGK Spark Plug and its co-conspirators carried out the conspiracy through meetings and conversations in which they discussed and agreed upon bids and price quotations on bids to be submitted to certain automobile manufacturers and to allocate the supply of the products to those manufacturers. NGK Spark Plug sold spark plugs, standard oxygen sensors, and air fuel ratio sensors at non-competitive prices to auto makers in the United States and elsewhere in furtherance of the agreement. NGK Spark Plug's involvement in the conspiracy lasted from at least as early as January 2000 until on or about July 2011.

NGK Spark Plug manufactures and sells spark plugs, standard oxygen sensors and air fuel ratio sensors. A spark plug is an engine component for delivering high electric voltage from the ignition system to the combustion chamber of an internal combustion engine. Oxygen sensors are located in the exhaust system and measure the amount of oxygen in the exhaust. Air fuel ratio sensors are "wideband" oxygen sensors that enable more precise control of the air/fuel ratio injected into the engine.

The charge against NGK Spark Plug is the latest in the department's on-going investigation into anticompetitive conduct in the automotive parts industry. These are the first charges filed relating to spark plugs, standard oxygen sensors and air fuel ratio sensors sold to automobile manufacturers.

Including NGK Spark Plug, 28 companies and 26 executives have pleaded guilty or agreed to plead guilty in the division's ongoing investigation into price fixing and bid rigging in the auto parts industry and have agreed to pay a total of $2.4 billion in criminal fines.

NGK Spark Plug is charged with price fixing and bid rigging in violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today's charge is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division's criminal enforcement sections and the FBI. Today's charge was brought by the Antitrust Division's Washington Criminal I Section and the FBI's Detroit Field Office with the assistance of the FBI Headquarters' International Corruption Unit. Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to the automotive parts industry should contact the Antitrust Division's Citizen Complaint Center at 1-888-647-3258, visit http://www.justice.gov/atr/contact/newcase.html or call the FBI's Detroit Field Office at 313-965-2323.


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  • 19 Comments
      Bufford Buchanan
      • 7 Months Ago

      Glad they caught them

      SloopJohnB
      • 7 Months Ago

      Fine should be 52 Billion.  52million is simply a cost accounting exercise, the cost of doing business.

      Nail them with a RICO violation and triple damages.

        GR
        • 7 Months Ago
        @SloopJohnB

        Nope. 

        NGK is a Japanese company and the DOJ only has jurisdiction because they sell products in the US. Also, it's not the DOJ that discovered the price fixing scheme. Japanese investigators discovered it and merely tipped off DOJ. 

        Lastly, $52 Million is appropriate as it was a plea deal. This means NGK and other companies/executives plead guilty and did not go to trial in agreement that they'd get a lower sentence/fine. It's how the law works, buddy. 


      Finklestein
      • 7 Months Ago

      What a shame...these guys make a good product!

        GR
        • 7 Months Ago
        @Finklestein

        No doubt. NGK makes some of the best spark plugs. They have great engineers and great assembly workers, but corrupt executives. This scenario is actually common in Japan. 

      Bob Sacamano
      • 7 Months Ago

      what about the co-conspirator?  It takes two.

        GR
        • 7 Months Ago
        @Bob Sacamano

        I'm sure it's part of the price fixing scheme that Denso and Mitsubishi among a few others were part of. Personally, I was waiting for NGK to get pulled into it too given they were left out when the news came out in 2013 yet they are Japanese and make comparable products to the other companies. 

        Now they are busted. 

      b.rn
      • 7 Months Ago

      Go DOJ!

        GR
        • 7 Months Ago
        @b.rn

        It's actually the Japanese investigators who discovered the price fixing theme. They tipped off the DOJ so the credit should go to Japanese authorities and not the DOJ. The DOJ merely has jurisdiction because these Japanese companies sell products in the US. Not surprisingly, the case settled with a plea agreement and rather low fine. 

        However, taking credit for other people's hard work is common in America. Look at WWII. I've seen many folks wear shirts or say things like "America: back to back world war champs". 

        However, if one actually had an education on WWII history, you'd know that the Soviet Union fought 2/3 of all the Nazi units in the war and they also fought and won the most decisive battle against the Nazis: Stalingrad. It was after this defeat that the Nazi empire dwindled in power. 

        The Allied Forces were essential in defeating the Nazis, but the Reds actually did much more to defeat the Nazis. It's simply indisputable fact.  

        The Americans were the ones who brought down the Japanese in WWII, but in the case of these price fixing Japanese parts makers, it was the Japanese authorities who uncovered it and filled the DOJ in on it. 

          b.rn
          • 7 Months Ago
          @GR

          Go Japanese investigators and DOJ!

          and...your lecture and attack on the US was uncalled for. 

          GR
          • 7 Months Ago
          @GR

          No, it was more Japanese investigators uncovering it and then letting DOJ know about it. The DOJ then prosecuted given they have the resources and more importantly, want the $ from settlements and plea deals. 

          Also, my lecture on the US taking credit for the defeat of the Nazis in WWII is 100% true. Don't believe me? Go study WWII history. 

          We Americans are a prideful and boastful bunch, even if when we don't actually deserve it. 

          mburke5325
          • 2 Months Ago
          @GR

          SHUT UP!

      jebibudala
      • 7 Months Ago

      I never did understand why price fixing is illegal.  There is massive competition in this market.  Let the consumers decide.

      I guess what pisses me off the most is the government collects the fines, and redistributes the money to their own special interest buddies.  If anything, the money should go back to the customers or shareholders.

      Jeff Gilleran
      • 7 Months Ago

      Well, with a good shake up, the great product they make can be now fairly priced. 

      icemilkcoffee
      • 7 Months Ago

      Seems like they didn't fix their prices well enough. NGK iridium spark plugs  cost more than the Denso or Bosch ones.

      OptimusPrimeRib
      • 7 Months Ago

      Screw the fines. These will probably be an easy write off for them or they'll just let some of the lower level employees go. how about jail time for the suits involved?

      MONTEGOD7SS
      • 7 Months Ago
      LS engines love them some TR6s in turbo apps.
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