On Wednesday, February 2, the Competition Commission of India (CCI) imposed penalties on five tire manufacturers and a tire makers’ association for indulging in caterlization, reported Mint.
The case was initiated by corporate affairs ministry in 2013-14, where it had said that five domestic tire manufacturer which account for 90% of the market share including–CEAT, JK Tyres, MRF, Apollo Tyres, and their association – Automotive Tyre Manufacturer Association (MCA) – had increased prices of tires and tubes on the plea of increase in cost of raw materials, but not vice versa.
The ministry and the regulator (appellant in the case) submitted that – that in 2013-14, All India Tyre Dealers’ Federation had sent a representation to MCA, which was forwarded to the CCI, alleging that when natural rubber price increased, the tire prices were increased in a concerted manner by the domestic major tire manufacturers, however, when price of natural rubber decreased, tire prices were not reduced by domestic major tire manufacturers and as such, they indulged in price parallelism and cartelization.
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