Scania fined €880m over price-fixing cartel

posted by Su-San Sit
in Law
28 September 2017

Scania has been fined €880m by the European Commission (EC) for participating in a 14-year long cartel to fix prices and pass on the costs of new emissions-reducing technology. 

Five other truck companies settled in July last year in a record €2.9bn cartel fine but Scania, which is owned by Volkswagen, said it denies any wrongdoing and would be appealing the EC’s decision. 

Margrethe Vestager, European competition commissioner, said the EC alleges that the companies colluded from January 1997 through to January 2011 to coordinate prices and timing of new emission-reducing technology for medium and heavy trucks. 

“Scania and the other truck manufacturers in the cartel produce more than nine out of every 10 medium and heavy trucks sold in Europe,” she said. 

“They account for around three quarters of inland transport of goods in Europe and play a vital role in the European economy. Instead of colluding on pricing, the truck manufacturers should have been competing against each other—also on environmental improvements.” 

A Scania spokesman said the company would be appealing on two grounds. 

“Scania has not, on any level or in any context, entered into an agreement with other manufacturers with regard to pricing and Scania has also not delayed the introduction of new engines compliant with EU legislation for exhaust emissions,” he said. 

The action has opened the manufacturers who settled to damage claims from truck buyers around Europe. There are 600,000 haulers around the continent, most of which are small businesses, according to EC figures.

The UK’s Road Haulage Association, which represents lorry drivers, is seeking £3.9bn in compensation – £6,000 for each of the nearly 650,000 lorries sold in the UK between 1997 and 2011—from all six truck companies in a case before the UK’s Competition Appeal Tribunal. 

EU rules allow the EC to fine a company up to 10% of their global turnover. 

The fines to the other members of the group were reduced by between 10-50%. Volvo/Renault paid €676m, Daimler was fined €1bn, Iveco’s fine was €465m and DAF’s bill came to €753m.

The five other cartel members’ charges were reduced based on when they applied for leniency and their level of cooperation with officials during the settlement process. As the whistleblower in the case, Volkswagen-owned MAN avoided its entire €1.2bn penalty.

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