DETROIT (June 6, 2:55 p.m. ET) — Swedish supplier Autoliv Inc. has agreed to plead guilty in a widening auto parts price-fixing investigation, the U.S. Department of Justice announced today.
Autoliv also has agreed to pay a $14.5 million fine for allegedly conspiring to fix prices of seat belts, airbags and steering wheels installed in U.S. cars for one automaker, and allegedly conspiring to fix seat belt prices for another automaker, the department's antitrust division said. The division did not identify the automakers.
Autoliv's plea agreement is the first to show that the ongoing global antitrust investigation has spread into occupant safety systems. Previous announcements have included wire harness and heater control suppliers.
In addition, Kazuhiko Kashimoto, a Yazaki Corp. executive, has agreed to serve 14 months in a U.S. prison and pay a $20,000 criminal fine for his role in a conspiracy to fix the prices of wire harnesses and other vehicle products manufactured in the United States, the Justice Department said. He is the fifth Yazaki executive to agree to a guilty plea in the case.
The Swedish supplier said its role in the U.S. case is now concluded and prosecutors agreed not to prosecute any individuals with the company, except possibly three people in the company's sales unit.
“It is simply unacceptable that we have ended up in this situation in the first place. It goes against everything we stand for,” CEO Jan Carlson said in a statement. “Therefore, we have cooperated extensively with the DOJ to investigate and rectify the matter as quickly as possible and, as a result, we have reached an early resolution of our part of this industry-wide investigation.”
Scott Hammond, deputy assistant attorney general of the antitrust division's criminal enforcement program, said in a statement: “By meeting in secret and agreeing to allocate the supply of various automotive parts, the conspirators colluded to rip off automotive manufacturers in the United States and abroad. These conspiracies eliminated competition and resulted in inflated prices to automotive manufacturers for parts in cars sold to U.S. consumers.”
Kashimoto's involvement in the automotive wire harness conspiracy lasted from about January 2000 until at least September 2007, court documents said. During the time of the conspiracy, Kashimoto held several management positions in Columbus, Ohio, and Japan for Yazaki's Honda sales and business unit.
The Justice Department said Kashimoto and other co-conspirators agreed to allocate the supply of wire harnesses on a model-by-model basis and coordinate price adjustment requests.
In order to keep their conduct secret, Kashimoto and his co-conspirators used code-names and met at private residences and remote locations, the department said in court documents.
Including Autoliv and Kashimoto, six companies and 10 individuals have been charged in the department's ongoing investigation into price fixing and bid rigging in the auto parts industry.
Fujikura Ltd. has agreed to plead guilty. Additionally, seven individuals — Junichi Funo, Hirotsugu Nagata, Tetsuya Ukai, Tsuneaki Hanamura, Ryoji Kawai, Shigeru Ogawa and Hisamitsu Takada — have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each.
Makoto Hattori has agreed to plead guilty and Norihiro Imai has pleaded guilty and awaits sentencing.
Hanamura, Kawai, Ogawa and Takada were all Yazaki executives. They have agreed to serve prison time ranging from 15 months to two years.
The auto parts price fixing probe has also yielded convictions in Japan. European antitrust regulators have been probing similar allegations.