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Glass makers crack under pressure
Written by Javier Espinoza,   

Four car glass makers have allegedly been caught cheating and are now dealing with the consequences. The European Commission antitrust division finedAsahi Glass, Pilkington, Saint-Gobain and Soliver a total of over 1.3 billion euros ($1.7 billion) on Wednesday for a cartel in delivering car glass.

The manufacturers "cheated the car industry and millions of car buyers for five years, between early 1998 and early 2003," the E.U.'s antitrust chief Neelie Kroes told reporters in Brussels, adding this is the largest fine ever imposed on a cartel in Europe.

"The products covered by the cartel were windscreens, side windows and rear windows for new cars, and branded replacements for these items sold by authorized repairers," Kroes added.

The four companies discussed the supply limits of car glass for new cars and renegotiated ongoing contracts during secret meetings at airports and hotels across Europe, the E.U. said.

The four companies controlled around 90.0% of the glass used in new cars and for original branded replacement glass for cars in the European Economic Area, including the E.U. countries plus Iceland, Norway and Liechtenstein, a market worth 2.0 billion euros in the last year of the infringement, the Commission said. The E.U. also said it started the investigation after a tip-off from "an anonymous source," and in 2005, antitrust authorities raided several car glass producers across Europe.

French company Saint-Gobain (other-otc: CODGF - news - people ) was fined 896.0 million euros ($1.1 billion); Pilkington, a U.K. unit of Japan's Nippon Sheet Glass, was charged 370.0 million euros ($463.0 million); Belgium's Soliver was fined 4.4 million euros ($5.5 million); and Asahi was charged 113.5 million euros ($142.1 million).

"The Commission increased the fines for Saint-Gobain by 60.0% because it was a repeat offender," the Commission said. Saint-Gobain was not immediately available to comment.

See: http://www.forbes.com/markets/2008/11/12/glass-makers-eufine-markets-equity-cx_je_1112markets10.html