German Automaker Under Suspicion Of Cartels

2023 Author: Eric Donovan | [email protected]. Last modified: 2023-08-25 09:36

The calamity for German car manufacturers is expanding. VW and Co. are said to have agreed with their suppliers, according to a media report - the diesel scandal could also have started this way.

According to a report, German car manufacturers are under suspicion of years of illegal collusion at the expense of consumers and suppliers. Volkswagen, Audi, Porsche, BMW and Daimler are said to have agreed in a joint cartel on technology, costs and suppliers, as "Spiegel" reported on Friday. The magazine relied on a brief that VW is said to have submitted to the competition authorities for Audi and Porsche. Daimler also filed a “kind of voluntary disclosure”. The carmaker's shares plummeted significantly on Friday afternoon.

Volkswagen, Daimler and BMW did not want to comment on it. Daimler and BMW spoke of “speculation”. The Federal Cartel Office in Bonn stated with a view to the «Spiegel» report: «We cannot comment on details of ongoing proceedings.» The EU Commission in Brussels - the highest competition authority in the European internal market - told the German Press Agency about the alleged brief from Volkswagen: "We are not giving any opinion on this issue."

Votes since the 1990s

The accusation weighs heavily: more than 200 company employees are said to have voted in secret working groups since the 1990s, thereby overriding the competition. It should have been about all the details of car development.

Possibly particularly explosive: alleged agreements on the technology for diesel exhaust gas cleaning. According to the report, Daimler, BMW, Audi, Porsche and VW have been coordinating for years how big the tanks should be for AdBlue - a urea mixture that is used to break down nitrogen oxides into the harmless components water and nitrogen. Because large tanks would have been more expensive, the companies are said to have agreed on small tanks. However, later this would not have been sufficient to adequately clean exhaust gases.

Basis for the diesel scandal

According to the "Spiegel" information, the basis for the diesel scandal could have been laid at this point. In September 2015, VW admitted to having manipulated millions of diesel engines whose exhaust gas cleaning only worked satisfactorily on the test bench.

The "Handelsblatt" also reported corresponding agreements. Accordingly, among the documents seized by the Munich II public prosecutor's office during searches in the VW Group, in apartments and at the US law firm Jones Day, there was an Audi presentation called “Clean Diesel Strategy” from April 2010. It was a “commitment of the German automobile manufacturers at board level ». This concerns the installation of smaller AdBlue tanks.

Truck cartel paid almost three billion euros

"Spiegel" reported that the working groups also dealt with the selection of suppliers or the determination of component costs. There is “the suspicion” - as it is said in VW's voluntary disclosure - that “behavior contrary to antitrust law” had occurred. A spokeswoman for the financial supervisory authority Bafin could not initially say whether the companies are obliged to inform the financial markets in such a case.

Agreements that restrict competition are prohibited in antitrust law. Such agreements can, for example, keep prices artificially high or reduce the quantities of products on offer - and thus harm consumers.

However, agreements are not uncommon. Again and again it happens that cartel guards become active. Exactly a year ago, several truck manufacturers were sentenced to a fine of 2.93 billion euros for unauthorized agreements. Daimler alone had to pay one billion.

Agreements on steel prices

The background to the cartel allegations are, according to «Spiegel», investigations into suspected collusion of steel prices. The cartel office searched the offices of car manufacturers and suppliers last summer. The investigators examined VW, Daimler and BMW as well as the suppliers Bosch and ZF, as spokesmen for the corporations confirmed at the time. A spokesman for the Cartel Office said: "Six companies were searched, and a total of 50 Federal Cartel Office employees were involved." Until such proceedings are concluded, the presumption of innocence always applies, he emphasized.

The office did not want to comment on the question of whether indications of further possible violations were found during these actions. The Federal Ministry of Economics in Berlin also said: "No comment." According to “Spiegel”, the indications of possible illegal agreements were “a kind of bycatch”. (AG / dpa)