Scania hit with hefty fine for price-fixing involvement

Swedish truck manufacturer Scania has been hit with a fine by EU regulators after it was found to have been involved in a price-fixing scheme. 

The European Commission is calling on the company to pay up the equivalent of £771 million, although another appeal against the ruling has already been launched.

Last summer a fine totaling £2.56 billion was leveled against five HGV manufacturers, including Volvo, Iveco and DAF. Scania was also implicated, but unlike its counterparts it chose to contest the claims made by industry regulators.

Authority involvement: 

MAN Truck & Bus was the firm which actually alerted authorities to the price-fixing cartel, enabling it to avoid punishment altogether in spite of its involvement. All of the other parties, excluding Scania, admitted their guilt and received a 10 per cent reduction in the amount they had to pay as a result.

Scania’s ongoing refusal to submit to the will of the EC, which has seen it avoid providing assistance to investigators of any kind, could prove even costlier in the long run.

This group of six firms accounts for 90 per cent of all trucks sold throughout the UK and the EU, meaning that they exert massive power and influence over the marketplace. The price-fixing scandal came about because they were seeking to pass on the cost of coping with stricter emissions regulations to customers rather than absorbing them internally.

EC spokesperson Margrethe Vestager said that this anti-competitive stance adopted by the manufacturers was immensely problematic and went against the ideals of an open marketplace, meaning that it was impossible for buyers to get a good deal.

As VW was involved in its own passenger car emissions scandal back in 2015, there may be assumptions that this event is linked to the price fixing of HGVs, although for the moment regulators are convinced that this is simply a coincidence.

Admissions of guilt:

Scania is part of the VW Group and is facing a fine that is dwarfed only by that handed out to Mercedes-Benz parent firm Daimler. And although it could end up having to pay over three-quarters of a billion pounds because of its actions, this is still not entirely set in stone.

The admissions of guilt by the other truck manufacturers were forthcoming, but Scania insists that it has not committed any act which contravenes rules and regulations governing the industry as a whole. This gives it the ability to continue contesting the claims and put off the need to pay anything, at least for the time being.

Even with this scandal hanging over the HGV market at the moment, the fact that so many major companies were involved means that buyers have little choice but to keep investing in trucks which come from one of the six implicated brands.

The fact that this issue was even publicised in the first place should be seen as a positive step and one which will hopefully minimise the likelihood of similar price fixing in the future.

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