BMW Raided in German Cartel Investigation, Daimler Seeks Immunity

Matt Posky
by Matt Posky
bmw raided in german cartel investigation daimler seeks immunity

Back in July, German authorities became concerned that the country’s manufacturers had been operating one of the largest automotive cartels in history. With many auto executives still under the microscope for diesel emission manipulation, combined with inter-familial strife between the Piech and Porsche clans, Germany’s auto industry was starting to resemble a PG version of the film Goodfellas — with a dash of Dallas, for flavor.

Despite some rather serious accusations, nothing really came of the cartel investigation. We were beginning to wonder if it was much ado about nothing. But Germany’s antitrust officials hadn’t forgotten — they were simply biding their time during preliminary investigations into corporate collusion and price-fixing. Earlier this week, they made their big move and raided BMW’s headquarters.

In addition to BMW, both Daimler and Volkswagen Group have been implicated in the cartel accusations after Der Spiegel magazine claimed all three conspired to fix prices on various automotive components for decades. Shortly afterward, the European Commission assembled a team to begin its investigation.

According to Reuters, the commission has yet to initiate any formal antitrust proceedings against the manufacturers. But EU staff announced the first raid had only taken place on Monday, October 16th.

BMW, however, did not frame it quite the same way. Instead, it called the event an inspection and specified that it was cooperating with officials by assisting the European Commission with its work. It also wanted to absolve itself from being conflated with the emissions blowback relating to the size of AdBlue tanks.

“The BMW Group wishes to make clear the distinction between potential violations of antitrust law on the one hand and illegal manipulation of exhaust gas treatment on the other,” the company said. “The BMW Group has not been accused of the latter.”

Meanwhile, Daimler announced Friday that it has “filed an application for immunity from fines with the European Commission some time ago.” Despite being still being in the middle of this new scandal, the manufacturer has positioned itself as the one having informed officials in the first place. By doing so, it may be able to take advantage of the European Union’s leniency program — which allows the first company to come forward with illicit activity to be absolved of financial penalties.

Chief Financial Officer Bodo Uebber said he was so confident in Daimler’s action that he saw no reason to set aside any funds for possible antitrust fines from the government.

Volkswagen may also receive leniency if the matter goes to court. While it wasn’t the first to “blow the whistle,” simply being cooperative and coming forward with additional information could alleviate possible fines by up to 50 percent. VW’s current course of action is unknown but it is believed to be more willing to cooperate with regulatory investigations than BMW. As things stand now, VW has stated it hasn’t been raided but declined to comment further.

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  • Speedlaw Speedlaw on Oct 21, 2017

    I'm pretty sure that the whole industry is this way. Car makers will support the artificial tiers by putting cash on the hood, never mind that mid range car X with a $1000 added to the interior will make it a class leader and probably nicer than the luxury rides two tiers up. They won't do that, so if it won't sell, then incentives....the product isn't made better or more competitive, they just jigger the pricing. We might not ever see it, but I'm sure each car maker has an exact idea what it costs to make a car by the competition. No one is going to upset what is a very profitable system...and no one will undercut the existing price and tier structure, not even the Chinese, until their homegrown cars can take on Honda, GM, MB, etc...then, it will get ugly, but we'll probably all be in electric appliances by that point.

  • Speedlaw Speedlaw on Oct 22, 2017

    If I had a source, I'd link...but Car makers all do a competitive analysis for other cars, part by part. This is well known. A car, past engineering, marketing and paying the talent in the C Suite, is commodity. X metal (frame/chassis/sheetmetal) An engine tires brakes Compare motorcycles....a Honda 125 is $4000, say. The worldwide Chinese knockoff of that bike $2300. A Harley is $15k. There isn't nearly $11k in materials between the two, and the basic assembly line is going to be the same. Compare my CTS to a Camaro. Same engine, trans, probably same Differential. Brakes are the same. In car electrics slightly different, but not much. All the stuff behind the dash HVAC, probably same. Better interior and more foam soundproofing ? Not $30k worth.......

  • 3SpeedAutomatic Drove a rental Cherokee for several days at the beginning of this year. Since the inventory of rental cars is still low, this was a 2020 model with 48k miles and V6. Ran fine, no gremlins, graphics display was easy to work, plenty of power, & very comfortable. Someone must of disarmed the lane assistance feature for the steering wheel never shook (YES!!!!!!!!). However, this woman's voice kept nagging me about the speed limit (what's new!?!?!?!).I was impressed enough to consider this a prime candidate to replace my 11 yr old Ford Escape. Might get a good deal with the close out of the model. Time will tell. 🚗🚗🚗
  • Bullnuke One wonders if this poor woman entered the US through Roxham Road...
  • Johnds Years ago I pulled over a vehicle from either Manitoba or Ontario in North Dakota for speeding. The license plates and drivers license did not come up on my dispatchers computer. The only option was to call their government. Being that it was 2 am, that wasn’t possible so they were given a warning.
  • BEPLA My own theory/question on the Mark VI:Had Lincoln used the longer sedan wheelbase on the coupe - by leaning the windshield back and pushing the dashboard & steering wheel rearward a bit - not built a sedan - and engineered the car for frameless side windows (those framed windows are clunky, look cheap, and add too many vertical lines in comparison to the previous Marks) - Would the VI have remained an attractive, aspirational object of desire?
  • VoGhost Another ICEbox? Pass. Where are you going to fill your oil addiction when all the gas stations disappear for lack of demand? I want a pickup that I can actually use for a few decades.