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Hitachi Automotive Systems Agrees to Plead Guilty to Involvement in Anti-Competitive Auto Parts Conspiracy

Hitachi Automotive Systems Ltd. has agreed to plead guilty and to pay a criminal fine of at least $55.48 million for its role in a conspiracy to allocate markets, fix prices and rig bids for shock absorbers installed in automobiles sold to U.S. consumers, the Justice Department announced today.

According to charges filed in the U.S. District Court of the Southern District of Ohio on Tuesday, from the mid-1990s until summer 2011 Tokyo-based Hitachi Automotive Systems agreed to allocate the supply of shock absorbers sold to targeted vehicle manufacturers. To keep prices up, Hitachi Automotive Systems and its co-conspirators also agreed to coordinate on price adjustments requested by the vehicle manufacturers and strived to keep their conduct secret by using code names and meeting in remote locations.

In 2013, Hitachi pleaded guilty and paid a $195 million fine for fixing the price of starters, alternators and other electrical automotive components. At that time, Hitachi received credit for substantially assisting the division’s investigation. But in the course of providing that assistance Hitachi failed to uncover that it had also conspired to fix the price of shock absorbers. As a result, the division will recommend a substantial increase in Hitachi’s criminal fine from the bottom of the Guidelines fine range and also recommend that the court place Hitachi on probation for three years. These recommendations are consistent with the division’s approach in cases where a company fails to uncover the entire scope of its illegal conduct at the time it enters into a plea agreement.

“Hitachi Automotive Systems thwarted the competitive process when it fixed the price of shock absorbers,” said Acting Assistant Attorney General Renata Hesse of the Justice Department’s Antitrust Division. “Compounding its error, when it pled guilty in 2013 Hitachi failed to clean house and uncover its participation in the shock absorbers conspiracy. The division will continue to take a hard line when companies fail to uncover additional anticompetitive behavior.”

“When companies conspire to fix prices, consumers are the victims,” said Special Agent in Charge Angela L. Byers of the FBI’s Cincinnati Division. “Working with the Department of Justice and our other partners, the FBI will continue to pursue those that illegally scheme to suppress and eliminate competition.”

Hitachi Automotive Systems has agreed to cooperate with the division’s ongoing investigation. The plea agreement is subject to court approval.

The charge is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anti-competitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s criminal enforcement sections and the FBI. Including Hitachi Automotive Systems, 46 companies and 64 executives have been charged in the division’s ongoing investigation and have agreed to pay a total of more than $2.8 billion in criminal fines.