DETROIT, Nov. 17, 2014 /PRNewswire/ -- In an industry exclusive, Automotive News reports today the inside story of how some Japanese mid-level managers at automotive suppliers protect their senior leaders by serving prison time in exchange for a lifetime of employment.
Interviewing a convicted executive who served a prison term for price fixing, Automotive News reveals the deals made within organizations caught in the U.S. Department of Justice investigations on bid-rigging.
The convicted executive tells Automotive News the practice used by some suppliers to employ convicted executives after their release from prison.
In exchange, the executives remain silent regarding the participation of other company executives in bid-rigging.
Automotive News' coverage shows how price fixing works, with suppliers agreeing among themselves who would be low bidder on which contract. The articles, by Tokyo-based Asia editor Hans Greimel, also reveal that a number of indicted executives who have not returned to the United States to face trial remain employed by suppliers in Japan.
The crackdown already has made history: The Department of Justice has issued record fines totaling $2.39 billion and counting. Some 30 mainly Japanese parts suppliers, making everything from wire harnesses to wiper switches, have been nabbed since 2011. Forty-four executives, almost exclusively Japanese, have been charged.
No one has challenged the charges in court; 26 executives have agreed to prison instead. Another 18 have yet to enter pleas or are otherwise ignoring their indictments.
The sheer size of the fines and the high number of indictments underscore deeply rooted and long-standing Japanese business practices that find competitors colluding on price-fixing so each maintains their share of the market. For the executives, the pressure both to do the price-fixing and to take a prison sentence to protect the company are framed by the whistleblower executive as cultural expectations.
Greimel's article "Confessions of a price-fixer" describes how price-fixing was conducted and provides details on the investigation by the Justice Department.
A video news release is also available and can be accessed here.
About Automotive News
Automotive News is the automotive industry's leading news organization, serving news and information to top industry executives -- including vehicle manufacturers, their original equipment suppliers and franchised dealers -- plus others allied with the industry. The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.
About Crain Communications
An industry leader, Crain Communications Inc. is one of the largest privately-owned business publishers in the U.S. with more than 27 business, trade and consumer publications and related websites in North America, Europe and Asia. As an authoritative source of vital news and information to industry leaders and consumers worldwide, each of the company's newspapers, magazines and websites have become required reading in their respective business and consumer sectors.
Video - http://youtu.be/8AuXMkuSkK0
SOURCE Automotive News