The Fines For German Car Manufacturers Will Be Maximum 10% Of Revenues


Germany’s Federal Cartel Office (FCO) has begun an investigation into Volkswagen(108,2€; – 2.9%), BMW (65,2€; – 2.4%), Daimler (52,3€; – 3.6%), Bosch ( unlisted components supplier) and ZF (unlisted components supplier) for possible collusion in the purchasing of steel.

This is another piece of negative news for the car companies. The sector has been penalised for the emissions scandal involving Volkswagen and other manufacturers, as well as the slowdown in the emerging markets. And let’s not forget the new challenges of a complicated scenario for the developed countries in the wake of Brexit. As far as the investigation by the FCO is concerned, the fines could amount to a maximum 10% of the companies’ revenues. But that limit is not normally established. In fact, in 2014 the FCO fined Schaeffler (components supplier) 371M€, which was equivalent to just a little over 3% of its revenues. That said, in terms of net profit, the amounts can be really significant: in Schaeffler’s case the fine represented about half of its profits.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.