South African motorists have their own Imraahn Ismail Mukaddam — the whistle-blower who blew the lid off collusion in the bread and milling industry.
The consumer hero this time is Alwyn Parsons, director of Witbank-based Parsons Transport. It was his complaint more than a year ago that sparked the Competition Commission’s investigation into collusion in South Africa’s tyre-making industry — and ultimately led to raids on the offices of Dunlop Tyres International, Bridgestone South Africa and the South African Tyre Manufacturers’ Conference (SATMC) two weeks ago.
The investigation follows recent high-profile probes into collusion in the milk, bread and pharmaceutical industries.
Parsons told the Mail & Guardian he had noticed that all tyre manufacturers’ prices were increasing at the same time and by similar margins.
He said the price increases ranged between 5% and 10% and were implemented more than twice a year.
He said the tyre-makers justified the price rises by blaming the weakening rand. He became suspicious when the rand strengthened but prices increased further.
”We got the impression that they were getting together to discuss price increases,” he said. ”It’s not a free market if these guys are standing together. I want it to be a competitive market out there.
”We thought that it needed to be investigated so we notified the Competition Commission. We just said that things looked funny.”
The commission’s senior analyst in charge of the investigation, Nandi Mokoena, says an initial inquiry uncovered enough information to request search warrants for the raids on the two tyre manufacturers and the SATMC.
Mokoena says the initial complaint lodged by Parsons was against the four tyre manufacturers in South Africa — Dunlop, Bridgestone, Continental Tyre South Africa and Goodyear South Africa — but the commission decided to add the SATMC as a respondent.
Mokoena says the commission thinks that ”coffee-table discussions” to determine price increases had taken place at the SATMC.
”This would be the most likely platform,” says Mokoena. ”Where there is a cartel going on in an industry, history has taught us that the industry association is normally the vehicle for collusion.”
In the course of the bread industry collusion case last year the head of the Competition Commission, Shan Ramburuth, said he believed that anti-competitive practices were rife in South African business. He said a lot of these practices were a hangÂÂover from the days of apartheid, when industry associations facilitated cartels.
Etienne Human, the head of the SATMC, told the M&G that he was aware of the Competition Commission’s investigation and that the SATMC would cooperate fully with it, but he did not want to comment at this stage.
The four tyre manufacturers are also remaining tight-lipped, releasing statements acknowledging the raids and the investigation and insisting that they will cooperate fully and have nothing to hide.
Dunlop chief executive Luis Ceneviz said the company cooperated fully with the commission when it raided Dunlop’s head office and complied with all requests made by investigators for hard copy or electronic documentation.
”At this point we are not able to give any further comment on the issue and have instructed our attorneys, who will be dealing with the matter,” said Ceneviz.
Bridgestone’s director of sales and marketing, Raymond Waldeck, said his company acknowledges the commission’s investigation. ”We have nothing to hide and we will give them our full cooperation.”
Goodyear’s spokesperson, Lize Hayward, said the company is not aware of any visit to any of its facilities regarding this issue.
”We are not aware of any wrongdoing by the company, but we will cooperate fully with the authorities in their investigation should we be asked to do so,” said Hayward.
Continental’s sales and marketing general manager, Eddie Jordaan, refused to discuss the matter and told the M&G to approach the SATMC for comment.