Auto parts manufacturer cartels and their impact on international trade

Auto parts manufacturers' cartels

It was 2005 when several large auto parts manufacturers supplying seatbelts, airbags and steering wheels began acting as cartels and launched coordinated anticompetitive actions that continued at least until 2011, in Japan, Europe and the United States, in order to capture different markets around the world, among them Brazil. This conduct affected several projects carried out by the automakers Toyota, Honda, Volkswagen, BMW and PSA Peugeot-Citroën, which manufacture and/or sell vehicles in that country. The companies investigated were ZF TRW Automotive Holdings Corp, Autoliv, Takata Corporation, Toyoda Gosei Co, Tokai Rika Co., together with some employees of the automakers who supplied confidential information to these companies. (1)

A cartel is an association formed by agreement among a group of companies, intended to prevent competition

How cartels' anticompetitive practices work

The anticompetitive practices investigated in this case by Brazil's Administrative Council for Economic Defense (CADE) and published on February 9, 2026 consisted of agreements on:

(i) market allocation: they divided up new business opportunities (sourcings) or agreed to respect each member's existing contracts to prevent prices from falling (resourcings).

(ii) price fixing, discounts and commercial proposals, which they then submitted to the automakers when the latter requested quotations (Requests for Quotation - RFQ)

(iii) exchange of sensitive commercial and competitive information: they shared strategic commercial data to coordinate their positions and to justify price increases based, for example, on the cost of raw materials.

These practices form part of an international auto parts supercartel comprising between 70 and 80 interconnected bid-rigging schemes, detected mainly between 2008 and 2017. Almost half of the companies convicted were parent companies headquartered in Japan or their subsidiaries.(2)

18 countries prosecuted this supercartel, which displayed exceptional duration, global reach, size and harm. Estimates of the commerce affected by the auto parts supercartel range between 3.2 and 5.0 trillion dollars.

Auto parts manufacturers and supply to automakers

One of the major challenges facing domestic and regional auto parts manufacturers is supplying automakers, and to do so they must compete with multinational auto parts manufacturers and system suppliers (first-tier or Tier 1 suppliers) which, having a global view of production, are able to form cartels and engage in this type of anticompetitive practice. Argentine auto parts manufacturers that detect such practices, even abroad but with a local impact, can turn to the National Competition Authority.(3)

References

(1) PROCESSO ADMINISTRATIVO SANCIONADOR. CARTEL NO MERCADO INTERNACIONAL DE MÓDULOS DE AIRBAG, CINTO DE SEGURANÇA E VOLANTE. EFEITOS NO BRASIL. SUGESTÃO DE CONDENAÇÃO PARCIAL. (Parecer Nº 0007/2026) sei.cade.gov.br

(2) John M. Connor - “Twilight of Prosecutions of the Global Auto-Parts Cartels” antitrustinstitute.org

(3) The National Competition Authority (ANC) operates as a decentralized and autonomous body within the National Executive, replacing the National Commission for the Defense of Competition (Comisión Nacional de Defensa de la Competencia, CNDC). argentina.gob.ar

Competition Law 25,156 (Ley de Defensa de la Competencia) provides: “ARTICLE 3 — All natural or legal persons, public or private, whether or not for profit, that carry out economic activities in all or part of the national territory, as well as those that carry out economic activities outside the country, are subject to the provisions of this law, to the extent that their acts, activities or agreements may produce effects on the national market…”