Takata to pay $71.3 million, plead guilty in seatbelt price-fixing scheme

Chad Halcom
CRAIN’S DETROIT BUSINESS

Published: October 11, 2013 1:10 pm ET
Updated: October 11, 2013 1:12 pm ET

Related to this story

Topics Automotive Legal
Companies & Associations

Takata Corp. expects to pay a $71.3 million fine and plead guilty to a criminal charge filed this week in Detroit of colluding with other automotive suppliers to set the prices of seatbelts for at least eight years.

Tokyo-based Takata, whose North American subsidiary TK Holdings Inc. in Auburn Hills was raided by the FBI in 2011, faces a charge of conspiracy to restrain trade in violation of the federal Sherman Antitrust Act before U.S. District Judge Lawrence Zatkoff.

The company will pay a $71.3 million fine to resolve that case under an agreement with the U.S. Department of Justice Antitrust Division, and Chairman-CEO Shigehisa Takada will take a 30 percent cut in executive compensation while other directors take a 15 percent cut, Reuters reported today.

The Justice Department has so far brought criminal charges against 21 companies, including Takata, and 21 executives, imposing nearly $1.7 billion in total fines since its automotive industry crackdown first moved to the courtroom stage in a September 2011 prosecution.

Federal officials allege various companies in the supply chain have conspired to rig the prices of at least 30 component products sold to Chrysler Group LLC, Ford Motor Co., General Motors Co. and the various U.S. subsidiaries of Asian automotive giants between January 2000 and early 2011.

Takata, specifically, is accused of conspiring with other companies between January 2003 and February 2011 to "suppress and eliminate competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize and maintain the prices of certain seatbelts," according to the criminal information sheet detailing charges against Takata, in Zatkoff's court.

Takata has been a seatbelt supplier to Toyota Motor Corp., Honda Motor Co. Ltd., Nissan Motor Co. Ltd., Mazda Motor Corp. and Fuji Heavy Industries Ltd., the parent company of Subaru, according to the Justice Department.

It is also a supplier of automotive air bags, interior components and steering wheel systems, which have been previous industry segment focus areas during the auto price-fixing investigation.

Takata's connection to the case traces back to a set of February 2010 FBI raids at the offices of Yazaki North America in Canton Township, Denso Corp. in Southfield and Tokai Rika Group North America in Plymouth Township.

Yazaki and Denso later agreed to pay fines of $470 million and $78 million, respectively, on the same charge of conspiracy to restrain trade — but federal officials brought an additional obstruction of justice charge against Tokai Rika, alleging an executive there directed the U.S. subsidiary employees to destroy records that were to be furnished to a grand jury.

The FBI then went on to raid TK Holdings in February 2011, seeking further documentation about Tokai Rika.

"After becoming aware of the FBI search of (Tokai's U.S.) subsidiary, an executive … directed employees to delete electronic data and destroy paper documents likely to contain evidence of antitrust crimes…," a plea agreement signed last fall by Tokai Rika Senior Managing Director Kenji Kawaguchi states. "[A]nd some of the deleted electronic data and destroyed paper documents were non-recoverable."

Tokai Rika went on to pay a $17.7 million fine involving prices of automotive heater control panels, after pleading guilty to both charges last December.


Comments

Takata to pay $71.3 million, plead guilty in seatbelt price-fixing scheme

Chad Halcom
CRAIN’S DETROIT BUSINESS

Published: October 11, 2013 1:10 pm ET
Updated: October 11, 2013 1:12 pm ET

Post Your Comments


Back to story


More stories

Image

DuPont exec: Still lots of lightweighting needed in the auto industry

March 23, 2015 6:00 am ET

In that role, Jeffrey Sternberg is responsible for bringing the breadth of DuPont advanced materials — as well as renewably sourced materials...    More

Image

How Faurecia made over a relic

March 23, 2015 6:00 am ET

Everything about Faurecia SA's interior trim plant in Saline, Mich., is big.    More

Image

Magna investing $135 million for new exteriors plant in Mexico

March 18, 2015 5:04 pm ET

Magna International Inc has started construction of a $135 million automotive exteriors manufacturing facility in Querétaro, in central Mexico.    More

Image

Auto supplier Visteon seeking new CEO

March 17, 2015 10:04 am ET

Visteon Corp. said Monday CEO Tim Leuliette will step down by the end of the year.    More

Image

Rosenberger expands in Hungary

March 17, 2015 9:57 am ET

Technical components producer Rosenberger Hochfrequenztechnik GmbH & Co. KG has unveiled the results of a 9 million euro ($9.5 million) upgrade and ex...    More

Market Reports

Flexible Packaging Trends in North America

North America represents about 30 percent of the global consumption of flexible packaging. Annual growth in this region is forecast at 4 percent during the next 5 years.

For more insight on growth opportunities, drivers of growth and the outlook for 2015, download this report.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 billion plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events