PRETORIA, South Africa (Sept. 7, 2010)—South Africa's Competition Commission is charging the country's four tire makers—subsidiaries of Apollo Tyres Ltd., Bridgestone Corp., Continental A.G. and Goodyear—with collusive tendering, price fixing, information exchange and market allocation.
Of the four companies charged—Apollo Tyres South Africa (Pty.) Ltd., Goodyear South Africa (Pty.) Ltd., Continental Tyre South Africa (Pty.) Ltd. and Bridgestone South Africa (Pty.) Ltd.—Bridgestone is cooperating with investigators and has been granted conditional immunity from prosecution.
Each company faces a fine up to 10 percent of its annual sales if found guilty.
The investigation also found that tire importers Yokohama Southern Africa (Pty.) Ltd. and Michelin Tyre Co. South Africa (Pty.) Ltd. were not involved in the cartel conduct.
The commission also charged the South African Tyre Manufacturers Conference (Pty.) Ltd. with complicity.
The case has been referred to South Africa's Competition Tribunal for adjudication.
Bridgestone immunity from prosecution falls under terms of the commission's Corporate Leniency Policy.
In its application for leniency, Bridgestone said it held phone calls and met with its competitors during the period 1999 to 2007 to agree in principle that they should cooperate to ensure stability in the market. The meetings were attended by the tire manufacturers' sales and marketing representatives, and coordinated the timing and the average percentage price increase of tires, agreed on the discount structure to be given to tire dealers and messages to be given to the market explaining the increases, the complaint charges.
The alleged cartel concerned the manufacture and supply of passenger tires, light truck/commercial tires, trucks and bus tires, OTR tires, agricultural tires and earthmover tires in South Africa, according to the complaint.
The commission's investigation found that the tire makers' group was used as a platform for what has been termed “coffee table discussions” to determine price increases and general coordination in the market among the tire manufacturers.