Goodyear Eagle NCT 5 tyres.
Goodyear, the tyre manufacturer, on Monday denied taking part in price collusion that allegedly happened between 1999 and 2007, at hearings held before the Competition Tribunal.
This follows the Competition Commission allegations that from about 1999-2007, the respondents discussed and agreed to fix the prices of passenger, light truck, bus, off-road, agricultural, and earthmover tyres.
This was allegedly done through the South African Tyre Manufacturers Conference (SATMC), an association for tyre manufacturers in South Africa. The respondents were SATMC members.
The matter emanates from a price-fixing complaint Parsons Transport lodged with the Commission.
"Following an investigation, the Commission concluded that the tyre manufacturers’ conduct contravened the price-fixing act," the Tribunal said.
Bridgestone applied for and was granted conditional immunity from prosecution during the investigation, in terms of the Commission’s corporate leniency policy. Apollo settled with the Commission in December 2011 and paid an administrative penalty of R45 million, the tribunal said.
The commission is seeking relief against the remaining respondents for alleged price fixing and is asking that administrative penalties be imposed against them.
The respondents are Apollo Tyres South Africa; Goodyear South Africa; Continental Tyres South Africa; Bridgestone South Africa; and the South African Tyre Manufacturers Conference.
The Competition Tribunal resumed hearing evidence on the price-fixing allegations.
According to the Tribunal, numerous local and international witnesses have already testified in this matter, during online proceedings heard earlier this year.
“While witnesses for Goodyear and the SATMC are expected to give evidence in the coming days, the Tribunal is also due to hear submissions relating to an application by Goodyear to have an expert economic report submitted as evidence and to call an expert witness in this regard,“ the Tribunal said.
During the hearing, Goodyear said if the price increases in the tyre industry for the past 15 to 20 years were analysed, since the price maintenance was abolished by the government, it would reveal that they had occurred in a narrow band.
"You will find that the price increases in the industry occurred in a very narrow band from a timing perspective. Since these price increases were in a narrow band, (it) does not indicate or prove in any way, shape or form that Goodyear was party to any price collusion," Goodyear said.
According to Goodyear, it did not declare the percentages of the increase in 2007 because of a marketing strategy.
"We did not announce the percentage upfront because we did not want our competitors to know exactly what was up then," Goodyear said.
Goodyear said the company could only speculate that was the reason why other tyre manufacturers like Bridgestone and Continental were also not revealing their percentage increase until the other manufacturers had. It said it was not because of price collusion.
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