VW's Trucking Unit Scania Fined $1 Billion For Price Fixing

VW's Trucking Unit Scania Fined $1 Billion For Price Fixing

Volkswagen’s trucking unit Scania has been given a $1 billion fine by the EU for taking part in a 14-year price fixing scandal. The European Commission said the Swedish company had colluded with five others to fix truck prices and decide when to pass on the cost of new emission technologies.

The Commission's investigation revealed that Scania had:

  • Coordinated on prices at "gross list" level for medium and heavy trucks in the European Economic Area (EEA).
  • Agreed with other members of the cartel on the timing for the introduction of emission technologies for medium and heavy trucks to comply with the increasingly strict European emissions standards.
  • Agreed to pass on to customers the costs for the emissions technologies required to comply with the increasingly strict European emissions standards.

The other members of the cartel were MAN, Daimler, DAF, Iveco and Volvo/Renault. They reached a record settlement with the European Union last year. MAN avoided a fine after blowing the whistle on the cartel and the others had their fines cut by 10% for pleading guilty. The total fine for the firms involved is now 3.8 billion euros. Scania refused to cooperate last year, according to the commission, and still denies any wrongdoing.

“We just received the information and it will take some time to go through the material. If no new information has emerged in the investigation we are planning to prepare an appeal against the decision,” a Scania spokeswoman said.

“Scania has not on any level or in any context entered into an agreement with other manufacturers with regards to pricing. Scania has also not delayed the introduction of new engines that meet EU legislation on exhaust emissions.”

Margrethe Vestager, the European commissioner for competition, said Scania would have received a 10% lower fine if it had reached a settlement with the commission.

“Today’s decision marks the end of our investigation into a very long-lasting cartel – 14 years. This cartel affected very substantial numbers of road hauliers in Europe, since Scania and the other truck manufacturers in the cartel produce more than nine out of every 10 medium and heavy trucks sold in Europe. Instead of colluding on pricing, the truck manufacturers should have been competing against each other – also on environmental improvements.”

The growing concerns about vehicle emissions and environmental pollutions have made many major countries to introduce emission regulations in order to cut down the greenhouse gases (GHG) and other pollutant emissions from vehicles. According to the global heavy-duty trucks market report, the tightening of such regulations has pushed manufacturers to find alternative fuel solutions for the trucks that are environment-friendly or help in reducing emissions. This has started the trend of biofuel, electric, and hybrid HD trucks.

The Commission said its investigation did not reveal any links between the truckmakers cartel and allegations of carmakers cheating on emissions control testing.

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