(CN) - Operating a cartel in the automotive ball-bearing market will cost five companies a combined $1.3 billion in fines, the European Commission said Wednesday.
Europe-based SKF and Schaeffler along with four Japanese companies - JTEKT, NSK, NFC and NTN - secretly colluded for more than seven years to coordinate pricing strategies, Brussels-based regulators said. Specifically, the companies engaged in an orchestrated effort to pass on steel price increases to their customers and schemed to fix prices on bids and annual contracts.
Ball bearings reduce friction between moving parts, and are commonly used throughout automobiles and trucks.
The cartel bust is part of an extensive investigation into car parts manufacturers, according to a statement by the commission.
"Today's decision is a further milestone in the commission's ongoing effort to bust cartels in the markets for car parts, after the sanctions we imposed on producers of electric wires and of foam
used in car seats," Joaquin Almunia, commission vice president in charge of competition policy, said in a statement. "It is incredible to see that one more car component was cartelized. I hope the fines imposed will deter companies from engaging in such illegal behavior and help restore competition in this industry. If left unchallenged, cartels for car parts might impair the competitiveness of the automotive sector and artificially raise the price paid by European consumers who buy cars."
JTEKT has immunity for blowing the whistle on the scheme, leaving the other five companies to divide payment of the fine topping $1.32 billion.
All of the companies had their fines reduced by 10 percent for agreeing to settle the case, regulators said.
Investigations into the automotive industry continue as regulators eye manufacturers of airbags, seat belts, steering wheels, HVAC systems and lights for possible price fixing charges, the commission said.