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Former Takata executive indicted in seat belt price-fixing scheme

By: Larry P. Vellequette
AUTOMOTIVE NEWS

June 5, 2014

A federal grand jury has indicted a former top-tier global sales executive at Takata Corp. on a charge of participating in a conspiracy to fix the prices for seat belts, the U.S. Department of Justice said June 5.

Gikou Nakajima, who served as director of customer relations for Takata from 2005 through at least June 2009, was indicted in Detroit on one count of conspiracy to fix prices in violation of the Sherman Act. If convicted, he could face up to 10 years in prison and a fine of up to $1 million, the Justice Department said.

The indictment alleges that Nakajima conspired with competitors to rig bids for the prices of seat belts sold to Japanese auto manufacturers and their subsidiaries for installation in vehicles sold in the United States and elsewhere. He is the fifth Takata executive to be charged in the government’s ongoing auto parts price-fixing investigation.

A spokesman for Takata was not prepared to comment on the indictment. It was not immediately clear who is representing Nakajima in the proceeding.

“The division will not tolerate executives participating in — and directing their subordinates to participate in — conspiracies to raise the prices on automotive parts that are essential to the safety of U.S. consumers,” said Brent Snyder, deputy assistant attorney general for the Antitrust Division’s criminal enforcement program, in a statement.

Takata of Tokyo ranks No. 44 on the Automotive News list of the top 100 global suppliers with worldwide original-equipment automotive parts sales of $4.86 billion during its 2012 fiscal year.

The automotive safety products supplier also has been linked to serious quality issues and last year ordered the largest airbag-related recall in history. Seat belt systems typically include both the textile webbing and injection molded housings and functional components.

Takata pleaded guilty on Dec. 5 for its involvement in the conspiracy and was sentenced to a criminal fine of $71.3 million.

Four lower-level Takata executives previously pleaded guilty in the conspiracy and were sentenced to prison time and criminal fines.

Including Nakajima, 35 individuals and 27 companies have been charged in the government’s investigation. Two dozen of the individuals and all of the companies have pleaded guilty and have agreed to pay a total of more than $2.3 billion in fines.