International Law

US Federal Government Investigates Toyota

The U.S. Federal Government, heavily invested in General Motors, investigates not only its competition, but its competition's suppliers, using its extraordinary powers:

Warrants were carried out on the Michigan offices of Yazaki Corp. in Canton, Denso International America Inc., in Southfield, and Tokai Rika Co., also known as Tram, in Plymouth, an FBI spokeswoman confirmed Wednesday.

"The Antitrust Division is investigating the possibility of anti-competitive cartel conduct of automotive electronic components suppliers," said Department of Justice spokeswoman Gina Talamona.

Prior to the federal bailout of GM, GMAC, Chrysler and Chrysler Financial, the Department of Transportation was relatively inactive with regard to Toyota safety issues. Surely, the Justice Department had not been involved. After the bailout, we see significant activity. What other agency will descend upon this company? Not I alone consider the dramatic change in Toyota's fortunes -- and now its suppliers -- with great suspicion, which the administration has brushed away like so much dander.

Yesterday, Secretary LaHood was asked before Congress if the the fact of US investment in the auto industry would have any impact upon the Toyota investigation. He immediately promised it wouldn't (I am looking for an mp3 or transcript of his testimony, which I heard over the radio.) With any administration, but especially with this strongly pro-statist group manning the helm, who can possibly believe such glib nonsense, especially when federal actions belie it?

We now have the US, as a regulator cum stakeholder, launching a criminal probe against a competitor. Do you not find this as frightening as I do?

Full post as published by Asia Business Intelligence on February 25, 2010 (boomark / email).