How General Motors Company (NYSE:GM) Hurt Your Wallet, Again
The U.S Department of Justice has come down heavily on car manufacturers including General Motors Company (NYSE:GM), that have been found guilty of price-fixing of a variety of car parts. Nine Japan-based companies and 2 executives will now plead guilty to this charge and pay fines amounting to $745M. The collective fine amount touches a whopping $1.6B.
On Thursday, the Department of Justice said that these automobile parts had been sold to General Motors Company (NYSE:GM), Ford Motors and Chrysler group LLC affiliate Fiat SpA. Apart from these companies, Mazda, Honda, Toyota, Nissan, Subaru and Mitshubishi subsidiaries in the United States had also been sold these price-fixed auto parts.
There were instances in which over 30 different product prices had been fixed and different conspiracies were operating alongside each other. What is surprising is that all these activities were running unabated for more than a decade said Scott Hammond from the antitrust division’s criminal-enforcement program that is run by the DoJ.
Along with the U.S DoJ, antitrust enforcers from across the globe were part of the investigation and Hammond gave due credit to the competition agency in Japan, It was the first agency to turn-up some of the illegal activities that were included in the Thursday settlement. Prices of auto parts such as radiators, seat belts, power-window motors, air-conditioning systems, windshield wipers and power steering components, had been fixed.
Putting an end to wrongdoing
Eric Holde, the Attorney General said that over 25M cars that had been bought by American customers have been affected by this illegal conduct. Every one of the executives and the companies in this plea deal have promised full co-operation with the DoJ’s ongoing antitrust probe. Holder said that they will not leave any stone unturned and will ensure that this destructive and illegal conduct is brought to an end.
General Motors Company (NYSE:GM) price declined slightly following this news.