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DoJ fines Japanese parts firms $740M in massive automotive price-fixing scandal

Nine Japanese suppliers have pleaded guilty in US court over charges of price fixing in the automotive parts industry, resulting in the Department of Justice doling out a total of $740 million of fines, according to a report from Bloomberg. The scandal, which has resulted in General Motors, Ford, Toyota and Chrysler spending up to $5 billion on inflated parts and driving up prices on 25 million vehicles has sent the DoJ hustling into investigations. "The conduct this investigation uncovered involved more than a dozen separate conspiracies aimed at the U.S. economy," Attorney General Eric Holder (pictured above) said during yesterday's press conference.
As the investigation stands, the DoJ has issued $1.6 billion in fines against 20 companies and 21 individual executives, with 17 of the execs headed to prison. Deputy Assistant Attorney General Scott Hammond said, "The breadth of the conspiracies brought to light today are as egregious as they are pervasive. They involve more than a dozen separate conspiracies operating independently but all sharing in common that they targeted US automotive manufacturers."
Big-name suppliers indicted in the investigation include Mitsubishi Electric, Mitsubishi Heavy Industries, Hitachi Automotive and Mitsuba Corporation. A list of fines and other corporations named in the investigation is available at Bloomberg.

Ford recalling 450,000 Fusion, Mercury Milan sedans

Ford has announced a pair of recalls, and both are critical safety issues. The exponentially larger of the two recall campaigns affects over 450,000 Ford Fusion and Mercury Milan sedans manufactured at the Hermosillo plant between July 21, 2008, and March 4, 2011. The canister purge valve in the fuel tank could malfunction and could cause the top of the tank to crack and leak fuel. That could cause a fire, although Ford "is not aware of any accidents, injuries or fires" resulting from the issue. Affected vehicles will have their ECU software updated and their fuel tanks inspected for potential replacement. The company estimates there are 411,205 affected units in the United States (and its federalized territories), plus another 33,605 in Canada, and 7,055 in Mexico. The second recall affects 13 F-650 trucks. The column shifter's park position mechanism may fracture and let the truck roll away unexpectedly. Those 2016 models built in Ohio between July 29 and September 3, 2015 are all located in the US. Fixing the problem will require replacing the steering column and reconfiguring the instrument panel. FORD ISSUES TWO SAFETY RECALLS IN NORTH AMERICA DEARBORN, Mich., Nov. 23, 2015 – Ford Motor Company is issuing two safety recalls in North America. Ford is not aware of any accidents, injuries or fires related to these conditions. Details are as follows: Ford issues safety recall for certain 2010-2011 Ford Fusion and Mercury Milan vehicles in North America for potential fuel tank issue Ford Motor Company is issuing a safety recall for approximately 450,000 2010-2011 Ford Fusion and Mercury Milan vehicles for a potential issue with the fuel tank. Some of these vehicles might have a canister purge valve that does not work properly, causing internal pressure changes inside the fuel tank. Repeated pressure changes inside the tank could result in a crack on the top of the tank, possibly allowing fuel to leak. A fuel leak in the presence of an ignition source can lead to a fire. Ford is not aware of any accidents, injuries or fires related to this condition. Affected vehicles include certain 2010-2011 Ford Fusion and Mercury Milan vehicles built at Hermosillo Assembly Plant from July 21, 2008 through March 4, 2011. There are a total of approximately 451,865 vehicles that might be affected in North America, including 411,205 vehicles in the United States and federalized territories, 33,605 in Canada and 7,055 in Mexico.

Bosch fined $57.8 million by DOJ for price fixing and bid rigging

The US Department of Justice has been investigating bid rigging and price fixing among automotive parts suppliers for years, and so far the agency has leveled nearly $2.5 billion in fines against 34 companies. The latest business to be caught in this ongoing crackdown is Germany's Robert Bosch GmbH (Bosch), the world's largest independent auto component maker, and it agrees to pay a $57.8 million criminal fine to the Feds. According to the DOJ, Bosch has agreed to plead guilty to pricing fixing and bid rigging for spark plugs and oxygen sensors supplied to the former DaimlerChrysler, Ford and General Motors. The rigging is said to have occurred between January 2000 and July 2011. Bosch also allegedly played foul with starter motors sold to Volkswagen from January 2009 until at least June 2010. Bosch and other companies allegedly conspired on the pricing for bids to submit to automakers, and sold the parts at noncompetitive prices. The DOJ filed a one-count felony charge in US District Court for these actions. The company's plea is still subject to court approval, though. Bosch is only the third European company to be charged in this investigation, according to the DOJ. So far, many of the fined businesses have been from Japan, including Takata, NGK and others. Some execs have claimed price-fixing has been the standard operating procedure in the auto parts industry for a long time. Robert Bosch GmbH Agrees to Plead Guilty to Price Fixing and Bid Rigging on Automobile Parts Installed in U.S. Cars Robert Bosch GmbH, the world's largest independent parts supplier to the automotive industry, based in Gerlingen, Germany, has agreed to plead guilty and to pay a $57.8 million criminal fine for its role in a conspiracy to fix prices and rig bids for spark plugs, oxygen sensors and starter motors sold to automobile and internal combustion engine manufacturers in the United States and elsewhere, the Department of Justice announced today. According to the one-count felony charge filed today in the U.S. District Court of the Eastern District of Michigan, Bosch conspired to allocate the supply of, rig bids for, and to fix, stabilize and maintain the prices of, spark plugs and oxygen sensors sold to automobile and internal combustion engine manufacturers such as DaimlerChrysler AG, Ford Motor Company, General Motors Company and Andreas Stihl AG & Co., among others, in the United States and elsewhere.