The Competition Commission says it has found evidence that South Africa’s dominant vehicle glass makers, PG Glass and Glasfit, colluded on prices for more than 20 years to the detriment of millions of consumers.
The finding follows an extensive investigation over a decade.
The competition watchdog on Thursday said it has referred the companies for prosecution in a matter that might see them docked 10% of their annual revenues.
The commission alleges the two companies agreed in a “concerted practice to fix prices of automotive glass products” they supplied to customers and insurance companies.
Commissioner Doris Tshepe said the unlawful conduct is said to have started in 2004 and continues to remain active.
She said evidence before the commission revealed the companies had a longstanding agreement to increase the price of vehicle glass they supply to customers by the same percentage point annually.
“Automotive glass forms part of industrial intermediary products, a priority sector for the commission,” said Tshepe. “The dismantling of the alleged cartel will contribute towards fairer pricing of automotive glass for the benefit of consumers and insurance companies.”
The decision to prosecute the companies comes a decade after the competition watchdog conducted a search-and-seizure operation at the Gauteng premises of PG Glass, Glasfit, Shatterprufe and Digicall as part of its investigation into alleged collusion.
PG Glass and Glasfit are vehicle glass fitment and repair service providers; Shatterprufe supplies PG Glass and Glasfit with vehicle glass, while Digicall processes and administers vehicle glass-related insurance claims on behalf of PG Glass and Glasfit.
At the time, the commission said it had reasonable grounds to believe that information relevant to this investigation was on the premises of the four firms.
PG Glass and Glasfit have a nationwide reach, with each home to more than 110 fitment centres and mobile units countrywide.
PG Glass is part of the PG Group, which has been in business for nearly 130 years.
The broader group produces, distributes and installs vehicle glass, building glass, aluminium frames and window film solutions.
PG Group is also the holding company for Shatterprufe and the largest glass-manufacturing corporation in Sub-Saharan Africa.
The PG Group is synonymous with building and vehicle glass throughout the Sub-Saharan region and is a major exporter of vehicle glass to, among other countries, Europe and India.
The group has just undergone a leadership change, following the retirement of its CEO, Charles Bromley, after 12 years at the helm.
Glasfit is led by Safiera Mall, who has been with the group since 2006, initially as CFO and later as CEO.
Digicall’s executive chair, Altmann Allers, also serves as Glasfit chair.
The relationship between insurance companies and vehicle glass manufacturers involves a complex, often integrated, network focused on safety, cost management, and rapid repair or replacement services.
According to Glasfit’s website, it is an accredited supplier to the country’s leading short-term insurance groups, including Santam, Auto & General, Miway, Hollard and OUTsurance, among a plethora of other insurance groups.
The clampdown on PG Glass and Glasfit is part of the commission’s wider crackdown on collusion on industrial intermediary products, which is the commission’s priority sector.
The watchdog last week descended on the premises of four scrap metal purchasing companies in Gauteng in search-and-seizure operations as part of its probe into price fixing in the industry.
The competition watchdog said it has reason to believe Scaw South Africa, Cape Gate, Shaurya Steel and Unica Iron and Steel have engaged “in fixing the purchase price of shredded or processed scrap metal”, with the companies now vulnerable to hefty fines should they be found guilty of anti-competitive behaviour.
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