The automotive supply chain is complex, distinctive and, susceptible to antitrust, particularly bid-rigging, conspiracies, as illustrated by the Auto Parts Antitrust Litigation, an unprecedently expansive conspiracy to bid rigs for many scores of components by many scores of sellers. In response, two U.S. auto manufacturers, Ford and FCA, have added antitrust specific provisions to their purchasing terms and conditions to better protect themselves against such conspiracies. FCA’s provision is narrowly focused on the Illinois Brick problem that is inherent in a multi-tiered supply chain. Ford’s is more ambitious, designed to provide a quicker and larger recovery when its suppliers are involved in criminal conspiracies. Each of the provisions are imperfect, but each provides the buyer meaningful advantages.

By Sheldon Klein[1]

 

I. INTRODUCTION

Supply chains are a creature of contract and thus can be adapted to meet the business needs of the contracting parties. Antitrust law is not. In the automotive supply chains, several buyers have adopted contractual provisions designed to better fit antitrust law to close that gap. This Article attempts to provide an overview of how and why those buyers have done so.

In ordinary language, Ford, Toyota, etc. make cars. In industry parlance they are “Original Equipment Manufacturers” or “OEMs.” But “maker” and “manufacturer” have almost become a misnomer. It was said of the Ford Rouge Plant that “iron ore,

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