The European Commission fined 15 major carmakers 458 million euros for violating recycling rules, but Mercedes escaped punishment thanks to whistleblowing.
According to the European Commission (EC), 15 major carmakers and the European Automobile Manufacturers' Association (ACEA) have entered into a long-standing agreement on recycling end-of-life vehicles. The 15 carmakers that have been fined include Stellantis, Mitsubishi, Ford, BMW, Honda, Hyundai/Kia, Jaguar Land Rover/Tata, Mazda, Renault/Nissan, Opel, General Motors, Suzuki, Toyota, Volkswagen, Volvo and ACEA.
Mercedes was the 16th company to join the agreement but was also the one that reported the matter to the EC, so it was not fined under the leniency program.
An end-of-life vehicle (ELV) is a vehicle that reaches its end-of-life due to age, wear and tear or damage. These vehicles are disassembled and processed for recycling, recall and disposal. The aim is to reduce waste and recover valuable materials such as metals, plastics and glass.
To ensure that materials are not wasted, and environmental problems are not caused, the EC requires manufacturers to cooperate with recycling units to collect and recycle end-of-life vehicles. At the same time, car manufacturers must publicly disclose the recycled content in newly produced vehicles, for example, plastics are required to contain 25%.
However, the EC investigation found that, during the 15 years from 2002 to 2017, manufacturers colluded to not pay car recyclers, in order to save costs, increase profits and not publicly disclose the recycled content of vehicles to avoid competition between manufacturers.
The total fines imposed by the 15 major carmakers and ACEA amounted to around 458 million euros ($495 million). Volkswagen paid the largest amount, at nearly 128 million euros ($138 million), while Jaguar Land Rover/Tata paid the lowest amount, at 1.64 million euros ($1.8 million). ACEA imposed a fine of 500,000 euros ($540,000).
The fines were set based on the EC’s 2006 guidelines on fines, which took into account a variety of factors, including the number of vehicles involved, the nature of the offence, the geographical scope and the duration of the offence. When setting the fines, the EC also took into account the lesser involvement of Honda, Mazda, Mitsubishi and Suzuki in the offence. The Commission also reduced Renault’s fine because it found evidence that Renault had explicitly requested an exemption from an agreement not to advertise the use of recycled materials in new cars.
Four companies cooperated with the Commission under the leniency program: Mercedes received a full exemption for disclosing information about the cartel, avoiding a fine of around €35 million ($37.8 million). Stellantis (which includes Opel), Mitsubishi and Ford benefited from reduced fines for cooperating with the Commission. The amount of the reduction depended on the timing of the cooperation and the evidence the company provided to prove the existence of the cartel.