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Auto Industry

EU to widen crackdown on car parts suppliers over anti-trust breaches

The EU is likely to impose fines on more car parts suppliers following in an investigation into price-fixing in the auto industry. The violations have been with disbelief by EU Competition Commissioner Joaquin Almunia.

Price-fixing among car parts suppliers in Europe had attained an unbelievable magnitude affecting virtually any part a car was made of, the EU's Competition Commissioner Joaquin Almunia said Wednesday.

Speaking in an interview with German weekly magazine Stern, Almunia said that he was very surprised by the cartels existing in the automobile industry. He also said that more car parts suppliers would be imposed fines in the course of this year.

Almunia did not elaborate on the EU Commissions findings, but said that the European Union's executive body had been looking into breaches of EU anti-trust rules in the industry for about two years. Probes were launched into manufacturers of seat belts, airbags, steering wheels, air conditioning systems, rolling bearings and engine control systems, the magazine added.

A first EU crackdown on auto cartels last northern hemisphere summer imposed a total of 142 million euros ($182 million) in fines on five global car parts suppliers with operations in the European Union.

Manufacturers Sumitomo, Yakazi, Furukawa, S-Y Systems Technologies and Leoni were convicted of running a cartel in so-called wire harnesses. These electric circuits are crucial in powering operations such as starting motors, opening windows and controlling air conditioning.

Sumitomo was not fined because it blew the whistle on the cartel, and charges were reduced for all other manufacturers as they cooperated with the investigation. Japanese firm Yazaki, however, was imposed the steepest fine of 125 million euros, while German manufacturer Leoni had to pay 1.8 million euros.

According to industry officials, car parts suppliers had made balance sheet provisions of several hundreds of millions of euros in expectation of the fines.

uhe/ph (Reuters, dpa)

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