Parts Supplier Accuses VW of Anticompetitive Tactics

The Prevent Group, an automotive parts supplier, alleged that Volkswagen used anticompetitive tactics to stop larger suppliers like Prevent from acquiring smaller auto parts suppliers in the U.S.

Nov. 22, 2019

Nov. 19, 2019—The Prevent Group alleges that Volkswagen used anticompetitive tactics to stop larger suppliers like Prevent from acquiring smaller auto parts suppliers in the U.S., including at least seven based in Michigan.

The Prevent Group, an auto parts supplier, filed a lawsuit Monday with the following allegations. Volkswagen did not immediately respond to a Reuters request for comment.

According to the complaint, Volkswagen's lower-tier suppliers typically have no choice but to "comply or die" with Volkswagen's unfair terms and prices, the complaint states. If these smaller firms were acquired by a larger supplier like Prevent, the complaint alleges, Volkswagen feared that it would lose its ability to extract prices and terms that were below competitive levels.

Prevent Group, a privately held global network of companies engaged in supplying automotive component parts, alleges it was a direct target of this anticompetitive campaign. For the past 15 years, Prevent Group has grown by acquiring smaller, Tier 2 and Tier 3 auto parts suppliers around the world, increasing their efficiency and output.