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Japan’s Antitrust Watchdog to Warn Toyota Subsidiary Over Unpaid Storage Costs

 |  June 30, 2024

Japan’s antitrust watchdog is set to issue a warning to Toyota Customising & Development Co., a subsidiary of Toyota Motor Corp., for allegedly forcing subcontractors to store auto parts molds without covering the associated costs, local media reported on Sunday.

According to Kyodo News, the subsidiary, which produces auto parts, ambulances, and racing cars, compelled approximately 50 suppliers to retain over 650 molds and inspection instruments. These were parts used in its previous vehicle models, despite having no plans to place new orders. The company, in which Toyota holds a 90.5-percent stake, has admitted to violating the subcontract law, the report stated.

Further compounding the issue, the Japan Fair Trade Commission suspects that the Toyota subsidiary returned over 50 million yen (about $310,000) worth of parts to more than 60 suppliers without valid reasons, as reported by Xinhua news agency.

The commission plans to issue a warning to Toyota Customising & Development Co., urging it to implement measures to prevent such violations from recurring in the future.

This incident underscores the ongoing scrutiny of corporate practices in Japan, particularly concerning the treatment of subcontractors and the enforcement of fair trade regulations. The Japan Fair Trade Commission’s actions reflect a broader effort to ensure that large corporations adhere to the country’s subcontracting laws and maintain fair business practices.

Related: Zeebiz