The Motor Industry Staff Association (MISA) has criticized the recent news that PG Glass and Glasfit have allegedly engaged in price-fixing in South Africa for more than two decades.
This follows the announcement where the Competition Commission revealed that a complaint against PG Glass and Glasfit has been referred to the Competition Tribunal for prosecution.
The complaint alleges that the two companies, which are market leaders for the distribution, fitment, and repair of automotive glass components, entered into an agreement or engaged in a concerted effort to fix prices.
Both companies supply these products to insurance companies and end-users in South Africa.
According to the Competition Commission, the conduct allegedly began in 2004 and remains ongoing to this day.
It said this practice constitutes price fixing, which contravenes the Competition Act 89 of 1998.
The Commission is now seeking an order declaring that PG Glass and Glassfit contravened the Act and and are liable to pay an administrative penalty equal to 10% of each company’s annual revenue.
MISA slammed the announcement, stating that it is shocked and deeply disappointed to learn that the two companies allegedly engaged in price-fixing of automotive glass components for 22 years, reported IOL.
“This would have had a severe impact on consumers and the broader retail motor industry, resulting in higher prices,” said MISA Chief Executive Officer: Operations, Martlé Keyter.
MISA is the majority trade union in South Africa’s retail motor industry with more than 75,000 members within the Motor Industry Bargaining Council (MIBCO).
PG Glass and Glassfit fall under the scope of MIBCO.
TopAuto has reached out to PG Glass to allow for comment, but has yet to receive a response as of the time of writing.
Price fixing allegations
An investigation by the Competition Commission revealed that PG Glass and Glasfit have a longstanding agreement to raise prices on the auto glass panels they supply to motorists and insurers.
It found that the two companies raise their prices by the same percentage points annually – a practice that has been described as cartel-like by the Commission.
“Automotive glass forms part of industrial intermediary products, a priority sector for the Commission,” Commissioner Doris Tshepe said in an official statement last Thursday (19 February).
“Dismantling of the alleged cartel will contribute towards fairer pricing of automotive glass for the benefit of consumers as well as insurance companies.”
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